The band structure of the layered perovskite SrBi2Ta2O9 (SBT) was calculated by tight binding and the valence band density of states was measured by x‐ray photoemission spectroscopy. We find both the valence and conduction band edges to consist of states primarily derived from the Bi–O layer rather than the perovskite Sr–Ta–O blocks. The valence band maximum arises from O p and some Bi s states, while the conduction band minimum consists of Bi p states, with a wide band gap of 5.1 eV. It is argued that the Bi–O layers largely control the electronic response whereas the ferroelectric response originates mainly from the perovskite Sr–Ta–O block. Bi and Ta centered traps are calculated to be shallow, which may account in part for its excellent fatigue properties.