Although principal and principle are pronounced the same, they have very different meanings. Oxford Dictionaries online http://oxforddictionaries.com/definition/principal defines the noun principal as “the most important or senior person in an organisation or group”; however, it is a common error to forget that principal can also be an adjective meaning “main” or “first in order of importance”. Here are some examples:
- He is the principal character in the film (principal as an adjective)
- Our next door neighbour David is the principal of the local school (principal as a noun)
As written in the usage section of the Oxford Dictionaries online http://oxforddictionaries.com/definition/principle the word principle is normally used as a noun meaning “a fundamental basis of a system of thought or belief”. Here are some examples:
- Jack had not received a payrise for two years, so he left the company as a matter of principle.
- Sheila had to apply the accounting principles when preparing the company accounts.
To recap: principal can be a noun or an adjective, whereas principle is used as a noun.
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Oxford Dictionaries online http://oxforddictionaries.com