This study investigates “what are the effective service recovery strategies in the airlines industry?” The effects of compensation and interpersonal communication on airline passengers’ responses after service recovery were analyzed. The study is unique in examining the role of responsibility locus on the effectiveness of service recovery strategies, and exploring the effect of downward social comparison strategy. Initial results suggest that the effectiveness of compensation and interpersonal communication on passengers’ responses varies as a function of the locus of responsibility. The findings should assist airlines to better understand the subtle influence that situation plays in service failure as well as developing direction to formulate effective recovery strategies to better manage passengers’ post-failure responses.