In the ever-evolving tourism and hospitality industry, understanding the dynamics between customers and frontline employees is crucial for organizational performance. Drawing on self-awareness theory, this research offers a nuanced perspective on how positive customer interactions can distinctively shape employees’ actions, both towards their organization and themselves. Utilizing a dual-method approach, this research comprises an online experiment involving 235 participants and a three-wave field survey of 337 employees. The results show that customer gratitude significantly bolsters employees’ pro-organizational behavior by elevating their public selfawareness. This effect is further amplified when employees possess extrinsic career goals. Additionally, customer gratitude fosters self-improvement behavior among employees by enhancing their private selfawareness. This effect is particularly pronounced when intrinsic career goals drive employees. These findings provide substantial implications for both academic research and practical management within the industry, highlighting the pivotal role of customer gratitude in shaping employee behavior and organizational outcomes.