The Helmholtz free energy, energy, and entropy of mixing of N,N-dimethylformamide (DMF) and water are calculated in the entire composition range by means of Monte Carlo computer simulations and thermodynamic integration using all possible combinations of five DMF and three widely used water models. Our results reveal that the mixing of DMF and water is highly non-ideal. Thus, in their dilute solutions, both molecules induce structural ordering of the major component, as evidenced by the concomitant decrease in the entropy. Among the 15 model combinations considered, only 4 reproduce the well-known full miscibility of DMF and water, 3 of which strongly exaggerate the thermodynamic driving force of the miscibility. Thus, the combination of the CS2 model of DMF and the TIP4P/2005 water model reproduces the properties of the DMF–water mixtures far better than the other combinations tested. Our results also reveal that moving a fractional negative charge from the N atom to the O atom of the DMF molecule, leading to the increase in its dipole moment, improves the miscibility of the model with water. Starting from the CS2 model and optimizing the charge to be moved, we propose a new model of DMF that reproduces very accurately both the Helmholtz free energy of mixing of aqueous DMF solutions in the entire composition range (when used in combination with the TIP4P/2005 water model) and also the internal energy of neat DMF.