The electronic energy band structure and linear optical coefficient of LiB3O5 (LBO) crystal were calculated with first-principle pseudo-potential plane wave method. The nonlinear optical coefficient of LBO was calculated using coupling perturbation (CP) method. The calculated refractive indices and second-harmonic-generation (SHG) coefficients matched well with experimental results. The electronic density of states on upper part of valence bands and bottom part of conduction bands were calculated. It is found that the 2p orbital of B and O atoms in LBO crystal are hybridized,which is the origin of the nonlinear property.