The intramolecular hydrogen bond in benzoylacetone has been studied with high-level ab initio Hartree-Fock and density functional theory methods. The results are compared to the experimental structure as obtained from low-temperature neutron and X-ray diffraction experiments. The calculations reveal that electron correlation effects are essential for modeling the experimental low-temperature neutron diffraction structure of benzoylacetone. At the B3LYP/6-311G(d,p) level of theory the intramolecular oxygen-oxygen distance is found to be 2.51 Angstrom and the hydrogen bond energy can be estimated to be 16 kcal/mol. The transition state for intramolecular hydrogen transfer was located with the barrier estimated to be about 2 kcal/mol, consistent with a low-barrier hydrogen bond. Upon addition of the zero-point vibration energies to the total potential energy, the internal barrier vanished, overall suggesting that the intramolecular hydrogen bond in benzoylacetone is a very strong hydrogen bond. Analysis of the electron density with the "atoms in molecules" theory revealed that both oxygen-hydrogen bonds have some covalent character. Theoretical atomic charges and the dipole moment were computed by fitting point charges to the electrostatic potential of the molecule. Excellent quantitative agreement is found for most properties of the charge density whether determined computationally or by X-ray diffraction. Both methods reveal that the oxygen and hydrogen atoms have substantial atomic charges, and consequently the resonance assisted hydrogen bond in benzoylacetone is best described as a 3-center, 4-electron sigma-bond with considerable electrostatic as well as covalent bonding contributions. The present study implies that if low-barrier hydrogen bonds (LBHB) are formed in enzymatic reactions, they possess covalency between the hydrogen atom and both heteroatoms in question. Furthermore, it is expected that large atomic charges will be found in the LBHB, which give rise to an additional electrostatic stabilization of the system.