Meg Whitman leads by not leading, bosses by not bossing, and manages by not managing.

And yet the 49-year-old CEO of eBay presides over a company that has been described as growing faster in its first decade than any other enterprise in the history of capitalism. Since Whitman joined eBay in early 1998, its revenue has exploded--from about $5.7 million to an expected $4.3 billion this year. The first global online marketplace to connect buyers and sellers 24-7, eBay conducts more transactions every day than the Nasdaq Stock Market. It started out as a quaint digital auctioneer of collectibles like Pez dispensers, but this year Whitman's company will enable the sale of over $40 billion worth of cars, clothing, and computers.

Guided by Whitman, eBay is redefining the bedrock business principles, including leadership, that have anchored successful corporations since the industrial revolution. In the process, Whitman has created a radically more democratic company, a model organization in which the collective intelligence and enthusiasm of its 157 million customers determine and drive the daily actions of its 9,300 employees.

Fair winds. This highly fragmented and participatory business model requires a new kind of corporate leader, one who, like Whitman, keeps a steady hand on the tiller rather than gripping and pulling hard on the levers of power.

That means subtly steering and influencing relationships--instead of controlling them--to generate financial returns. It means working from a cube, not a corner office, and conversing, not commanding. It means asking questions, as opposed to providing answers, and then sharing what's been learned. It means building continual consensus and earning trust through transparency. Finally, it means understanding that bottom-line success often stems from experimenting and failing--or from doing nothing when bold action seems desperately needed.

"It's different from traditional leadership," says Whitman. "It's usually: What does the center want to do? It's command and control. At eBay, it's a collaborative network," she adds. "You are truly in partnership with the community of users. The key is connecting employees and customers in two-way communication. We call it 'The Power of All of Us.' "

Adds Yochai Benkler, a Yale Law School professor who studies the economics of networks: "The new corporate leader weaves a texture out of the threads flowing from his or her company's community. This is not an architect imposing his or her blueprint on everyone."

Whitman has woven her tapestry from three basic and counterintuitive strands.

First, she realizes she can't control eBay's community of buyers and sellers, because they don't report to her and if they're dissatisfied, they don't have to show up for "work." "It's not our baseball card," says Tom Tierney, an eBay director and chairman of Bridgespan Group, a nonprofit consulting firm. "We're not owners."

Whitman's second leadership strand--people are basically good, so trust them--was originally formulated by Pierre Omidyar, the former software engineer who founded eBay. It was Omidyar who came up with eBay's feedback system, which allows buyers and sellers, true strangers, to evaluate each other based on the quality of their dealings. Says Whitman: "Our company is built and managed on validation. Where else can you wake up and see how much you are liked each day?"