The co-precipitation method was used to prepare silver ferrite AgFeO2. The resulting powders were brick brown flakes. X-ray diffraction and Mössbauer spectroscopy were used as complementary methods to study structure and hyperfine interactions of silver ferrite. It was found that AgFeO2 has delafossite structure with two polytypes, i.e., rhombohedral 3R and hexagonal 2H, wherein the 2H polytype is dominant. The average crystallite sizes, estimated using Scherrer formula, were in the range of 15–35 nm. The Mössbauer spectrum registered at room temperature is one paramagnetic doublet with isomer shift characteristic for high-spin Fe3+ ions in an octahedral oxygen environment. In the temperature range of 3.7 K ≤ T ≤ 16 K Mössbauer spectroscopy revealed a distribution of the hyperfine magnetic fields at 57Fe nuclei connected with complicated collinear and non-collinear magnetic structure of AgFeO2. It was found that the value of the average hyperfine magnetic field monotonically decreases with an increase of temperature.