Abstract This article aims to investigate the electronic properties of GaTe/CdS heterostructure using first-principles calculations based on density functional theory (DFT). A direct band gap of 0.804 eV and type-II band alignment are formed at the GaTe/CdS van der Waals heterobilayer interface, which is beneficial to the spatial effective separation of photogenerated electron–hole pairs. The external electric field can prominently modify the band structure of the GaTe/CdS heterobilayer, occurring indirect-gap to direct-gap and semiconductor to metal transitions under critical electric field. Besides, the biaxial strain also makes a pivotal contribution to the band gap modulation, arising direct-gap to indirect-gap and semiconductor to metal transitions within the range of elastic response. Our results suggest that GaTe/CdS heterostructure is a promising candidate for application in future nanoelectronics and optoelectronics device and also provide some valuable information for future experimental research.