Interlayer interactions in layered transition metal dichalcogenides are known to be important for describing their electronic properties. Here, we demonstrate that the absence of interlayer coupling in monolayer VTe2 also causes their structural modification from a distorted 1T′ structure in bulk and multilayer samples to a hexagonal 1T structure in the monolayer. X-ray photoemission spectroscopy indicates that this structural transition is associated with electron transfer from the vanadium d bands to the tellurium atoms for the monolayer. This charge transfer may reduce the in-plane d orbital hybridization and thus favor the undistorted 1T structure. Phonon-dispersion calculations show that, in contrast to the 1T′ structure, the 1T structure exhibits imaginary phonon modes that lead to a charge density wave (CDW) instability, which is also observed by low-temperature scanning tunneling microscopy as a 4 × 4 periodic lattice distortion. Thus, this work demonstrates a novel CDW material, whose properties are tuned by interlayer interactions.