The YAG (110) twin grain boundaries with different terminations (Al, Y–Al, and O) are constructed and optimized by empirical potential approach. The results show that the Aloct- and Y–Altet-termination configurations namely G(Aloct) and G(Y–Altet) are the most energetically favorable grain-boundary structures. The ab initio DFT calculations are further performed to investigate the atomic structure, electronic structure, and optical properties of the G(Aloct) and G(Y–Altet). The overall total density of states of the G(Aloct) and G(Y–Altet) have similar features with the bulk YAG except that some new defect states are introduced at the top of the valence band resulting in the reduction in the band gap. The calculated optical properties show that the refractive indices of the grain boundaries are slightly higher than the single crystal YAG, which is in agreement with the experimental result.