We have carried out a series of ab initio calculations to investigate changes in the optical properties of Si quantum dots as a function of surface passivation. In particular, we have compared hydrogen-passivated dots with those having alkyl groups at the surface. We find that, while on clusters with reconstructed surfaces complete alkyl passivation is possible, steric repulsion prevents full passivation of Si dots with unreconstructed surfaces. In addition, our calculations show that steric repulsion may have a dominant effect in determining the surface structure and eventually the stability of alkyl-passivated clusters, with results dependent on the length of the carbon chain. Alkyl passivation weakly affects optical gaps of silicon quantum dots, while it substantially decreases ionization potentials and electron affinities and affects their excited state properties. On the basis of our results, we propose that alkyl-terminated quantum dots may be size selected, taking advantage of the change in ionization potential as a function of the cluster size.