Abstract Natural transformation is a major mechanism of horizontal gene transfer (HGT) and plays an essential role in bacterial adaptation, evolution, and speciation. Although its molecular underpinnings have been increasingly revealed, natural transformation is not well characterized in terms of its quantitative ecological roles. Here, by using Neisseria gonorrhoeae as an example, we developed a population-dynamic model for natural transformation and analyzed its dynamic characteristics with nonlinear tools and simulations. Our study showed that bacteria capable of natural transformation can display distinct population behaviors ranging from extinction to coexistence and to bistability, depending on their HGT rate and selection coefficient. With the model, we also illustrated the roles of environmental DNA sources—active secretion and passive release—in impacting population dynamics. Additionally, by constructing and utilizing a stochastic version of the model, we examined how noise shapes the steady and dynamic behaviors of the system. Notably, we found that distinct waiting time statistics for HGT events, namely a power-law distribution, an exponential distribution, and a mix of the both, are associated with the dynamics in the regimes of extinction, coexistence, and bistability accordingly. This work offers a quantitative illustration of natural transformation by revealing its complex population dynamics and associated characteristics, therefore advancing our ecological understanding of natural transformation as well as HGT in general.