A theoretical investigation of the role of f-states on electronic and optical properties of CeF3 and GdF3 is presented. Our calculations are based on density functional theory using the full potential linearized augmented plane wave method with the inclusion of spin-orbit coupling. We employed the Coulomb-corrected local spin density approximation (LSDA + U), known for treating the highly correlated 4f electrons properly. The LSDA + U calculations shift the f-states away from Fermi energy (E (F)) yielding an insulating ground in agreement with experiment. We find that electronic structure is greatly influenced by the occupancy of f electron. Our calculated reflectivity spectra are compared with the experimental data. The value of calculated reflectivity for both CeF3 and GdF3 compounds stays low till similar to 7 eV which is consistent with their large energy gaps. The results are analyzed in the light of band to band transitions. We have also presented the frequency-dependent dielectric constant and corresponding spectrum of the refractive index for these compounds.