These often-confused words have clearly defined and distinguishable meanings. As a noun, principal means "a sum of money" and "a chief person," "the head man." As an adjective, principal means "main" or "foremost." "The principal invested in that scheme amounted to $1,000." "The principal of this school is a woman of remarkable vigor." "His principal aim is to get well." Principle, a noun only, means "a governing rule or truth," "a doctrine," "a determined course of action": "The manager is a man of sound ethical principle." "That statement expresses a principle of modern physics." "As a matter of principle, he refused to borrow money from anyone." "The principal of that academy is a person of principle."
Dictionary of problem words and expressions. Harry Shaw. 1975.