The effect of exchange-correlation potential on InPS4 electronic structure was studied by applying GGA, GGA + U, mBJ, and mBJ + U potentials in the Kohn–Sham framework. The use of mBJ + U in full potential APW + lo method results in reliable K-absorption spectrum, which consists of nearly full experimental peaks of right intensity. The remarkable discrepancy between and occurs at 0 eV, 4 eV, 6 eV, and 9.5 eV, indicating the strong anisotropic optical properties of InPS4 at these energy levels. At 4 eV, is 37% higher than The optical absorption of InPS4 has high order of 105cm−1 magnitude for wide energy range, at least within 4–20 eV. The difference in extinction coefficient and is 30%–50% at 4 eV, 6 eV, 8 eV, and 11 eV. The figure of merit ZT of InPS4 is rather low. At n = 8 × 1018 cm−3, ZT achieves its highest value of about 0.8–1. InPS4 is a p-type semiconductor for chemical potential μ ranging from 0 eV to about 1.6 eV, but it is an n-type semiconductor for μ of about 1.6–2.7 eV. The Poisson’s ratio is equal to 0.26 and B/G 1.75. Indium thiophosphate InPS4 possesses rather low deformation resistance with the Young and shear moduli of 38.47 GPa and 15.27 GPa, respectively.