Gallium-doped zinc oxide (GZO) surfaces, both bare and modified with chemisorbed phosphonic acid (PA) molecules, are studied using a combination of density functional theory calculations and ultraviolet and X-ray photoelectron spectroscopy measurements. Excellent agreement between theory and experiment is obtained, which leads to an understanding of: i) the core-level binding energy shifts of the various oxygen atoms belonging to different surface sites and to the phosphonic acid molecules; ii) the GZO work-function change upon surface modification, and; iii) the energy level alignments of the frontier molecular orbitals of the PA molecules with respect to the valence band edge and Fermi level of the GZO surface. Importantly, both density of states calculations and experimental measurements of the valence band features demonstrate an increase in the density of states and changes in the characteristics of the valence band edge of GZO upon deposition of the phosphonic acid molecules. The new valence band features are associated with contributions from surface oxygen atoms near a defect site on the oxide surface and from the highest occupied molecular orbitals of the phosphonic acid molecules.