We report on molecular dynamics simulations of the frequency-dependent dielectric relaxation spectra at room temperature for aqueous solutions of a hydrophilic peptide and an amphiphilic peptide at two concentrations. We find that only the high-concentration amphiphilic peptide solution exhibits an anomalous dielectric increment over, that of pure water, while the hydrophilic peptide exhibits a significant dielectric decrement. The dielectric component analysis carried out by decomposing these peptide solutions into peptide, hydration layer, and outer layer(s) of water clearly shows the presence of a unique dipolar component with a relaxation time scale on the order of similar to 25 ps (compared to the bulk water time scale of similar to 11ps) that originates from the interaction between the hydration layer water and the outer layer(s) of water. Results obtained from the dielectric component analysis further show the emergence of a distinct and much lower frequency relaxation process for the high-concentration amphiphilic peptide compared to the hydrophilic peptide due to strong peptide dipolar couplings to all constituents, accompanied by a slowing of the structural relaxation in all water layers, giving rise to time scales close to similar to 1 ns. We suggest that the molecular origin of the dielectric relaxation anomalies is due to frustration in the water network arising from the amphiphilic chemistry of the peptide that does not allow it to reorient on the picosecond time scale of bulk water motions. This explanation is consistent with the idea of the "slaving" of residue side chain motions to protein surface water, and furthermore offers the possibility that the anomalous dynamics observed from a number of spectroscopies arises at the interface of hydrophobic and hydrophilic domains on the protein surface.