This study presents a comprehensive density functional theory (DFT) investigation of the double perovskite compounds K2AgSbX6 (X = Cl, F, I) using the generalized gradient approximation (GGA) and modified Becke-Johnson (mBJ) exchange-correlation functionals. The electronic, optical, elastic, and thermoelectric properties of these materials have been systematically analyzed to evaluate their potential for photovoltaic and thermoelectric applications. The novelty of this work lies in the comparative band-gap engineering of K2AgSbX6 through halide substitution, together with a combined assessment of optical absorption, mechanical stability, thermoelectric performance, spin–orbit coupling effects, and thermodynamic behavior. The calculated lattice constants, formation energies, and structural stability parameters confirm the thermodynamic stability of all three compounds. Electronic band structure calculations reveal semiconductor behavior with band gaps ranging from 0.373 eV (K2AgSb6) to 2.07 eV (K2AgSbF6) using GGA, and 1.041 eV to 4.11 eV using mBJ approximation. Including spin–orbit coupling slightly reduces the mBJ band gaps to 0.97 eV for K2AgSbI6, 2.42 eV for K2AgSbCl6, and 4.017 eV for K2AgSbF6, with the strongest SOC influence observed for the iodine-based compound. Effective-mass calculations further show that K2AgSbI6 has the lowest carrier effective mass among the studied compounds, with values of 0.204 m0, 0.226 m0, and 0.231 m0 using GGA, mBJ, and mBJ + SOC, respectively, indicating more favorable carrier transport compared with K2AgSbCl6 and K2AgSbF6. The optical properties demonstrate excellent absorption characteristics in the visible and near-infrared regions, making these materials promising candidates for solar cell applications. In particular, K2AgSbI6 exhibits low-energy absorption starting near ~ 1 eV, supporting its relevance for visible/near-infrared optoelectronic response. Elastic property analysis indicates mechanical stability and ductile behavior for all compounds. Phonon-dispersion calculations show the absence of imaginary frequencies along the investigated high-symmetry directions, confirming the dynamical stability of K2AgSbCl6, K2AgSbF6, and K2AgSbI6. The thermoelectric properties show significant potential for energy harvesting applications, particularly at elevated temperatures. The highest thermoelectric figure of merit is obtained for K2AgSbI6, with ZT exceeding 1.0 at high temperature, whereas K2AgSbF6 shows the lowest ZT because of its wider band gap and reduced carrier activity. These results identify halide substitution as an effective route to tune the electronic, optical, and thermoelectric response of K2AgSbX6 double perovskites.