This study investigated the mechanisms through which daily work mode (i.e., working from home [WFH] vs. working at the office [WATO]) influences daily fulfillment of psychological needs. Drawing from self-determination theory (SDT), we hypothesized that employees experience higher fulfillment of the needs for autonomy and competence, and lower fulfillment of the need for relatedness, on days when they are in the WFH mode than on days when they are in the WATO mode. We further hypothesized that perceived monitoring, interruptions, and social interactions are mechanisms through which these daily effects occur. WATO prevalence (the percentage of co-workers at the office) was explored as a potential moderator. Participants (N = 136) completed an end-of-day diary for one workweek (620 observations). Consistent with our hypotheses, we found that employees experienced higher daily fulfillment of the need for autonomy, and lower daily fulfillment of the need for relatedness, when working from home vs. when working at the office, and that these relations were partially mediated by perceived monitoring and positive social interactions, respectively. Daily work mode was not related to daily fulfillment of the need for competence, but was related to daily interruptions (i.e., intrusions, distractions, and breaks). WATO prevalence strengthened the relation between daily work mode and daily fulfillment of the need for relatedness. This research advances the application of SDT to hybrid work, contributing to the literature on need fulfillment. Organizations can enhance employee motivation by offering hybrid work arrangements and minimizing surveillance practices, thereby fostering autonomy and relatedness.