Electronic absorption and synchrotron radiation circular dichroism (SRCD) spectra of the anionic, cationic, and zwitterionic forms of L-alanyl-L-alanine ( AA) in aqueous solutions were measured and interpreted by molecular dynamics ( MD) and ab initio computations. Time-dependent density functional theory (TD DFT) was applied to predict the electronic excited states. The modeling enabled the assessment of the role of molecular conformation, charge, and interaction with the polar environment in the formation of the spectral shapes. Particularly, inclusion of explicit solvent molecules in the computations appeared to be imperative because of the participation of water orbitals in the amide electronic structure. Implicit dielectric continuum solvent models gave inferior results for clusters, especially at low-energy transitions. Because of the dispersion of transition energies, tens of water/AA clusters had to be averaged in order to obtain reasonable spectral shapes with a more realistic inhomogeneous broadening. The modeling explained most of the observed differences, as the anionic and zwitterionic SRCD spectra were similar and significantly different from the cationic spectrum. The greatest deviation between the experimental and theoretical curves observed for the lowest-energy negative anion signal can be explained by the limited precision of the TD DFT method, but also by the complex dynamics of the amine group. The results also indicate that differences in the experimental spectral shapes do not directly correlate with the peptide main-chain conformation. Future peptide and protein conformational studies based on circular dichroic spectroscopy can be reliable only if such effects of molecular dynamics, solvent structure, and polar solvent-solute interactions are taken into account.