diff --git a/CHANGELOG.md b/CHANGELOG.md
index 5477ae7940d..587ca0a61b2 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -11,6 +11,8 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
   ([#1854](https://github.com/open-telemetry/opentelemetry-python/pull/1854))
 - Changed AttributeValue sequences to warn mypy users on adding None values to array
   ([#1855](https://github.com/open-telemetry/opentelemetry-python/pull/1855))
+- Fixed exporter OTLP header parsing to match baggage header formatting.
+  ([#1869](https://github.com/open-telemetry/opentelemetry-python/pull/1869))
 
 ## [1.2.0, 0.21b0](https://github.com/open-telemetry/opentelemetry-python/releases/tag/v1.2.0-0.21b0) - 2021-05-11
 
diff --git a/exporter/opentelemetry-exporter-otlp-proto-grpc/src/opentelemetry/exporter/otlp/proto/grpc/exporter.py b/exporter/opentelemetry-exporter-otlp-proto-grpc/src/opentelemetry/exporter/otlp/proto/grpc/exporter.py
index be58cd82586..7b9227fd07f 100644
--- a/exporter/opentelemetry-exporter-otlp-proto-grpc/src/opentelemetry/exporter/otlp/proto/grpc/exporter.py
+++ b/exporter/opentelemetry-exporter-otlp-proto-grpc/src/opentelemetry/exporter/otlp/proto/grpc/exporter.py
@@ -229,9 +229,20 @@ def __init__(
 
         self._headers = headers or environ.get(OTEL_EXPORTER_OTLP_HEADERS)
         if isinstance(self._headers, str):
-            self._headers = tuple(
-                tuple(item.split("=")) for item in self._headers.split(",")
-            )
+            temp_headers = []
+            for header_pair in self._headers.split(","):
+                key, value = header_pair.split("=", maxsplit=1)
+                key = key.strip().lower()
+                value = value.strip()
+                temp_headers.append(
+                    (
+                        key,
+                        value,
+                    )
+                )
+
+            self._headers = tuple(temp_headers)
+
         self._timeout = timeout or int(
             environ.get(OTEL_EXPORTER_OTLP_TIMEOUT, 10)
         )
diff --git a/exporter/opentelemetry-exporter-otlp-proto-grpc/tests/test_otlp_trace_exporter.py b/exporter/opentelemetry-exporter-otlp-proto-grpc/tests/test_otlp_trace_exporter.py
index 3f43f1a8ccc..521c9e6e827 100644
--- a/exporter/opentelemetry-exporter-otlp-proto-grpc/tests/test_otlp_trace_exporter.py
+++ b/exporter/opentelemetry-exporter-otlp-proto-grpc/tests/test_otlp_trace_exporter.py
@@ -180,7 +180,7 @@ def tearDown(self):
             OTEL_EXPORTER_OTLP_TRACES_ENDPOINT: "collector:4317",
             OTEL_EXPORTER_OTLP_TRACES_CERTIFICATE: THIS_DIR
             + "/fixtures/test.cert",
-            OTEL_EXPORTER_OTLP_TRACES_HEADERS: "key1=value1,key2=value2",
+            OTEL_EXPORTER_OTLP_TRACES_HEADERS: " key1=value1,KEY2 = value=2",
             OTEL_EXPORTER_OTLP_TRACES_TIMEOUT: "10",
             OTEL_EXPORTER_OTLP_TRACES_COMPRESSION: "gzip",
         },
@@ -195,7 +195,7 @@ def test_env_variables(self, mock_exporter_mixin):
         _, kwargs = mock_exporter_mixin.call_args_list[0]
 
         self.assertEqual(kwargs["endpoint"], "collector:4317")
-        self.assertEqual(kwargs["headers"], "key1=value1,key2=value2")
+        self.assertEqual(kwargs["headers"], " key1=value1,KEY2 = value=2")
         self.assertEqual(kwargs["timeout"], 10)
         self.assertEqual(kwargs["compression"], Compression.Gzip)
         self.assertIsNotNone(kwargs["credentials"])
@@ -217,7 +217,7 @@ def test_no_credentials_error(
 
     @patch.dict(
         "os.environ",
-        {OTEL_EXPORTER_OTLP_TRACES_HEADERS: "key1=value1,key2=value2"},
+        {OTEL_EXPORTER_OTLP_TRACES_HEADERS: " key1=value1,KEY2 = VALUE=2 "},
     )
     @patch(
         "opentelemetry.exporter.otlp.proto.grpc.exporter.ssl_channel_credentials"
@@ -228,7 +228,7 @@ def test_otlp_headers_from_env(self, mock_ssl_channel, mock_secure):
         exporter = OTLPSpanExporter()
         # pylint: disable=protected-access
         self.assertEqual(
-            exporter._headers, (("key1", "value1"), ("key2", "value2"))
+            exporter._headers, (("key1", "value1"), ("key2", "VALUE=2"))
         )
         exporter = OTLPSpanExporter(
             headers=(("key3", "value3"), ("key4", "value4"))