The dipole moment of a single water molecule in liquid water has been a critical concept for understanding water’s dielectric properties. In this work, we investigate the dipole moment of liquid water through a self-attractive Hartree (SAH) decomposition of total electron density computed by density functional theory, on water clusters sampled from ab initio molecular dynamics simulation of bulk water. By adjusting one parameter that controls the degree of density localization, we reveal two distinct pictures of water dipoles that are consistent with bulk dielectric properties: a localized picture with smaller and less polarizable monomer dipoles, and a delocalized picture with larger and more polarizable monomer dipoles. We further uncover that the collective dipole-dipole correlation is stronger in the localized picture and is key to connecting individual dipoles with bulk dielectric properties. Based on these findings, we suggest considering both individual and collective dipole behaviors when studying the dipole moment of liquid water, and propose new design strategies for developing water models.