This paper describes the influences of a surfactant on crosslinked polyethylene (XLPE) insulation. Several kinds of additives are mixed into the insulation in order to improve the dielectric breakdown strength of XLPE cables. It has been verified that the interfacial diffusion method, which modifies the interfacial region between the insulation and the semiconducting layer by a surfactant, is effective. The effects of the surfactant on the morphology in the XLPE insulation were studied with two kinds of specimens. In the first kind of specimens, a mill was used to disperse the surfactant throughout the insulation material. Alternating current dielectric breakdown tests were performed on disk specimens. Their average breakdown strengths were improved, but the breakdown strengths were not increased at the low probabilities of the hazard function. In the other specimens, the surfactant was milled into the semiconducting layer, and later allowed to enter the insulation by diffusion during the high-temperature crosslinking process. It was found that the average breakdown strengths were improved further. Moreover, the breakdown strengths were found to increase significantly at the low probabilities of the hazard function. The two kinds of specimens were followed by material analysis using analytical methods, such as TEM, FT-IR, etc. Results from the milled specimen indicated that the improvement in property was probably due to the increase in density of the amorphous portion, the increase in the lamella thickness, and the increase in spherulite radius created by the additive content. Therefore the insulation near the interface where a concentration gradient was established by diffusion from the semiconducting layer is considered to have similar morphological changes caused by the additive. In addition, the diffusion specimen was observed to have an absence of introduced microdefects that existed in the milled specimen.