The role of dipolar interactions in determining the lipid domain shapes at the air - water interface with a change in the chemical structure of the head groups of lipids is theoretically studied. The phospholipids considered are dipalmitoylphosphatidylcholine (D,L-DPPC) and dipalmitoylphosphatidylethanolamine (DPPE). Despite closely similar chemical structures, the domains of the two lipids are strikingly different. The DPPC domains exhibit elongated arms, while the DPPE domains are nearly round-shaped. To compare the dipolar repulsions in the domains of the two phospholipids, different energy-minimized conformers of DPPC and DPPE are studied using the semiempirical quantum chemical method (PM3). It is found that the dipole moment of DPPC is significantly larger than that of DPPE. The in-plane and out-of-plane components of the dipole moments are calculated using grazing incidence X-ray diffraction data at different surface pressure values, as used in the experiment. The result indicates that the magnitude of the dipolar interaction is significantly larger in DPPC than that in DPPE over the surface pressure range considered. The enhanced dipolar repulsion corroborates well with the difference in the domain shapes in the two phospholipid monolayers. The larger dipolar repulsion in DPPC leads to development of elongated domain arms, while relatively less dipolar repulsion allows a closed shape of the condensed-phase DPPE domains. © 2007 American Chemical Society.