New improved model was developed to calculate the absorption and refractive-index spectra in the band-edge region for all the important compound semiconductors. An accurate absorption model including Coulomb interaction and Urbach-broadened band edge has been demonstrated for direct bandgap semiconductors. We have developed a accurate model in which a piecewise linear approximation is used for the shape of the absorption spectrum. We also propose a steep-edged compound Lorentzian line-shape function (SCL-LSF) for modeling the Urbach tail, and the line broadening of exciton absorptions. The results of applying this fitting procedure to the absorption spectra of GaAs, InP and InAs are presented, and a consistent set of band parameters are extracted. The analytical absorption model is suitable for a complete closed-form Kramers-Kronig transform of the absorption spectrum to obtain the refractive index spectrum. A band-to-band Coulomb interaction model for the refractive index spectra is presented of AlxGa1-xAs for 0 < x < 0.412, and In0.53Ga0.47As ternary semiconductors at photon energies near and above the band gap. An accurate absorption model is used to calculate the contribution on the refractive index near band-edge region through a complete closed-form Kramers-Kronig transform. By including a single oscillator Sellmeier model for the high-energy absorption spectrum, closed-form expressions are obtained for the band-edge region refractive index. Both spectra are fully described in terms of a finite set of parameters that can be interpolated for all the important compound semiconductors. The refractive index spectra are extended beyond the band-gap energy and are in excellent agreement with the available experimental data. Our new model makes accurate modeling possible for devices such as electroabsorption and electrorefraction modulators.