We present a unified framework for modeling agents’ epistemic states and counterfactual conditionals. The novelty of our approach lies at the semantic level. We introduce a computationally grounded semantics in which an agent’s doxastic accessibility relation, needed to model the standard notion of deductively closed belief, is derived from the agent’s belief base, and in which the notion of comparative similarity between states, needed to interpret counterfactual conditionals, is computed from both the atomic formulas describing the agents’ belief bases and those describing the environment. We use this semantics to interpret a language of beliefs and counterfactuals. We demonstrate the expressiveness of our language and the flexibility of the semantics by formalizing a wide range of notions: counterfactual dependence, counterfactual notions of reason and knowledge, conditional belief. Furthermore, we show that our semantics illuminates the subtle interplay between belief change and counterfactuals. On the computational side, we provide a succinct formulation of model checking for our language and establish a PSPACE complexity result.