Amino acid ionic liquids (AAILs) are gaining attention because of their potential in CO2 capture technology. Molecular dynamics simulations of AAILs tetramethylammonium glycinate ([N-1111][Gly]), tetrabutylammonium glycinate ([N-4444][Gly]), and 1,1,1-trimethylhydrazinium glycinate ([aN(111)][Gly]) and their corresponding mixtures with water were performed to investigate the effect of water concentration on the cationanion interactions. The water content significantly influenced the free volume (FV) and fractional free volume (FFV) of the AAILs that varied with the hydrophobic and hydrophilic nature of the ion pairs. Under dry conditions, the FFV increased with increasing cation molecular sizes, indicative of proportional adsorption of any inert gases, such as N-2, as consistent with experimental observations. Furthermore, the polarity of the cation played an important role in FFV and hence the diffusion of the AAILs. Density functional theory calculations suggested that hydrophilic [aN(111)][Gly] featured stronger interactions in the presence of water, whereas the hydrophobic IL showed weaker interactions. The carboxylate group of glycinate displayed stronger interactions with water than the cation. The computational study provided qualitative insight into the role of FV of the AAILs on CO2 and N-2 absorption and suggests that [aN(111)][Gly] has CO2 adsorption capacity in the presence of water superior to that of other studied AAILs.