In the past decade, intense interest has focused on the phase separation and lateral organization of two-dimensional lipid systems. In this manuscript, we describe a method for extracting the interfacial line tension between coexisting monolayer phases through direct observations of thermal fluctuations using fluorescence microscopy and digital image processing. We demonstrate that the interfacial line tension calculated from the capillary wave spectrum is in good agreement with previous measurements employed using other experimental techniques. A distinct advantage of this method is that line tensions can be extracted directly from acquired images. In addition, small line tensions are measured, enabling characterization of phase separated membranes near critical points. Future applications of this method are briefly discussed.