Hyperdoping has emerged as a promising method for designing semiconductors with unique optical and electronic properties, although such properties currently lack a clear microscopic explanation. Combining computational and experimental evidence, we probe the origin of sub-band-gap optical absorption and metallicity in Se-hyperdoped Si. We show that sub-band-gap absorption arises from direct defect-to-conduction-band transitions rather than free carrier absorption. Density functional theory predicts the Se-induced insulator-to-metal transition arises from merging of defect and conduction bands, at a concentration in excellent agreement with experiment. Quantum Monte Carlo calculations confirm the critical concentration, demonstrate that correlation is important to describing the transition accurately, and suggest that it is a classic impurity-driven Mott transition.