K2YF5 crystals doped with lanthanide ions have a variety of possible optical applications. Owing to the low symmetry of the system, the crystal structure cannot be unambiguously determined by x-ray diffraction. However, electron paramagnetic resonance studies have demonstrated that lanthanide ions sub stitute for yttrium in sites of Cs local symmetry. In this work, we use high resolution absorption and laser spectroscopy to determine electronic energy levels for Er3+ ions in K2YF5 microparticles. A total of 39 crystal-field energy levels, distributed among 7 multiplets of the Er3+ ion, have been assigned. This optical data is used for crystal-field modelling of the electronic structure of Er3+ in K2YF5 . Our model is fitted not only to the electronic energy levels, but also to the ground-state g-tensor. This magnetic-splitting data defines the axis system of the calculation, avoiding ambiguities associated with low-symmetry crystal-field fits.