We report and explain circular dichroism in semiconductor quantum dots. CdS nanocrystals capped with penicillamine enantiomers were prepared and found to be both highly luminescent and optically active. No new features in circular dichroism were observed as the nanocrystal grew larger. Density functional calculations reveal that penicillamine strongly distorts surface Cd, transmitting an enantiomeric structure to the surface layers and associated electronic states. The quantum dot core is found to remain undistorted and achiral.