Full potential linearized augmented plane wave (FP-LAPW) method based on the density functional theory (DFT) is used to investigate the structural, electronic and magnetic properties of Fe and Ni (3d transition metal) substituted Rock-salt wide band gap insulator Mg1-xMxO (M = Fe, Ni). We have performed spin polarized calculations throughout this work with generalized gradient approximation (GGA) type exchange correlation functional. Additionally, the electronic structures and density of states are computed using modified Becke-Johnson (mBJ) potential based approximation with the inclusion of coulomb energy (U = 7 eV). Based on the Vegard's law and structural optimization, the lattice parameter and bulk modulus are found to be in good agreement with experimental values. Moreover, the analysis of electronic band structures reveals an insulating character for Ni substituted MgO while semiconducting and half-metallic character for Fe substituted case. It has been found that the p-d super-exchange interaction provides a ferromagnetic character due to the 3d transition metal impurities and oxygen atom. The observed p-d hybridization at the top of the valence band edge in this investigations could be useful for magneto-optic and spintronic applications. PACS: 61.66.Dk; 71.15.Mb; 71.15.Nc; 71.20.Nr; 71.22.+ i. © 2018 Elsevier B.V.