The electronic structures and photocatalytic properties of bismuth oxyhalide bilayers (BiOX1/BiOX2, X1 and X2 are Cl, Br, I) are studied by density functional theory. Briefly, their compositionally tunable bandgaps range from 1.85 to 3.41 eV, suitable for sun-light absorption, and all bilayers have band-alignments good for photocatalytic water-splitting. Among them, heterogeneous BiOBr/BiOI bilayer is the best as it has the smallest bandgap. More importantly, photo-excitation of BiOBr/BiOI leads to electron supply to the conduction band minimum with localized states belonging mainly to bismuth of BiOBr where the H+/H2 half-reaction of water-splitting can be sustained. Meanwhile, holes generated by such photo-excitation are mainly derived from the iodine states of BiOI in the valence band maximum; thus, the O2/H2O half-reaction of water splitting is facilitated on BiOI. Detailed band-structure analysis also indicates that this intriguing spatial separation of photo-generated electron-hole pairs and the two half-reactions of water splitting are good for a wide photo-excitation spectrum from 2–5 eV; as such, BiOBr/BiOI bilayer can be an efficient photocatalyst for water-splitting, particularly with further optimization of its optical absorptivity.