On September 19, 2019, Senate Democrats released a report finding that Leach did not sexually harass any individual or create a hostile work environment while serving as a state senator. The report came in response to allegations levied against Leach in December 2017. On December 16, 2017, Philly.com reported that at least 11 of Leach's former employees said he either touched women without their consent or made inappropriate sexual comments around them. In response to the allegations, Leach said that he was unaware of his staffers having problems with his sense of humor or that his touching made them feel uncomfortable. He also said that his political opponents had started rumors about him. He also said, "Politics is, sadly, an ugly business. And given the current atmosphere, these sorts of deep-sea fishing expeditions into everyone’s past are likely to become standard. That’s a shame. I worry that we risk weaponizing and trivializing a long overdue and critically important movement." On December 18, 2017, Leach announced that he "taking a step back" from his congressional campaign due to the allegations against him. He did not say whether he was suspending or ending his campaign. In his statement he indicated that he would not resign from the state Senate. Leach then officially ended his congressional campaign in February 2018.

In January 2019, Senate Democrats hired a law firm to investigate allegations of sexual misconduct against Leach. Leach was accused of coercing Cara Taylor to perform oral sex in 1991, when she was 17 years old and he was 30 years old. At that time, Leach was an attorney for Taylor's mother in an attempted homicide case. Leach denied the allegations. In an opinion piece for The Philadelphia Inquirer, he wrote, "I learned that I have been largely oblivious to the nature of power dynamics and privilege, both between men and women and between employers and employees." He said he realized his humor "could be off-color or offensive." He also said he had "always been a somewhat touchy person" without realizing that "not everyone has the same comfort level with touching." He apologized, writing, "I am truly sorry for ever saying or doing anything that has made anyone uneasy, uncomfortable, or distressed." On February 4, Leach stepped down from his position as Democratic chairman of the Senate Judiciary Committee. In a statement, Leach said he would be "working to clear my name against completely false assertions."

See also: Sexual assault and harassment in American politics (2017-2018) Daylin Leach was mentioned during a wave of sexual assault and misconduct allegations in 2017 and 2018. On December 16, 2017, Philly.com reported that at least 11 of Leach's former employees said he either touched women without their consent or made inappropriate sexual comments around them. In response, Leach said that he was unaware of his staffers having problems with his sense of humor or that his touching made them feel uncomfortable. He also said that his political opponents had started rumors about him. He also said, "Politics is, sadly, an ugly business. And given the current atmosphere, these sorts of deep-sea fishing expeditions into everyone’s past are likely to become standard. That’s a shame. I worry that we risk weaponizing and trivializing a long overdue and critically important movement." On December 18, Leach announced that he "taking a step back" from his congressional campaign due to the allegations against him. He did not say whether he was suspending or ending his campaign In his statement he indicated that he would not resign from the state Senate.