Density functional theory (DFT)-based calculations for both the charge-ordered and the valence-mixed phases of YBaFe2O5 have been performed using the WIEN2K package and the generalized gradient approximation (GGA)+U method. YBaFe2O5 crystallizes in an oxygen-deficient perovskitelike structure featuring corner-sharing distorted square FeO5 pyramids separated by a layer of yttrium atoms in the c direction. It shows antiferromagnetic ordering below the Néel temperature of 430 K, below which it can be characterized as a Robin-Day class-III mixed-valence (MV) compound in which all iron atoms have the same noninteger oxidation state of 2.5. This compound is of particular interest since it undergoes a Verwey transition at approximately 309 K. Below the Verwey temperature the existence of two independent iron sites are found experimentally, which are occupied by fully localized divalent and trivalent iron atoms. This charge-ordered modification can thus be classified as a class-I MV compound. The Verwey transition of YBaFe2O5 is a first-order phase transition between low-temperature charge-ordered and high-temperature valence-mixed modifications which is accompanied with a dramatic change in the electronic configuration of the iron ions. For both phases the electronic and magnetic structures as well as electric field gradients, isomer shifts, and hyperfine fields have been calculated and compared to the experimental data. The value of Ueff (needed for the GGA+U calculation) has been estimated using a constrained DFT method. Different magnetic arrangements have been calculated in order to investigate the magnetic interactions and exchange parameters J , from which it was possible to verify the experimentally observed magnetic structures for both modifications.