Using density functional theory, we have studied the structure and energetics of the (001) face of gamma alumina. Our results address several experimental issues: (1) When the face with tetrahedral aluminum is exposed in the bulk-terminated system, the surface reconstructs extensively, leading to exposure of the higher-density layer. When only a few layers are present, this reconstruction may even lead to the collapse of the system into a different structure. (2) We find that the lowest energy is obtained if the vacant spinel sites lie on octahedral positions. We also find that vacancies are less preferred on the surface than in the bulk. (3) Migration to and from the surface of vacant spinel sites, by hopping of Al atoms between octahedral and tetrahedral cation sites has a rather high barrier. This suggests the vacancy distribution may not reach equilibrium if the material is not annealed carefully during preparation.