The invention provides a dual-mode plasma arc device for rotating electrode atomization. The dual-mode plasma arc device comprises a high-frequency oscillator connected with a power supply, and the high-frequency oscillator is further connected with a truncated-cone-shaped cathode; a Laval type plasma gun nozzle is arranged outside the truncated-cone-shaped cathode, and the Laval type plasma gun nozzle is connected with a gas compressor and the power supply separately; and the power supply is further connected with a second electric brush and a first electric brush, the second electric brush and the first electric brush are located on the upper side and the lower side of the left end of an electrode bar, and the electrode bar is opposite to the left end of the truncated-cone-shaped cathode. A method for centrifugal atomization comprises the steps that (1), the electrode bar is installed, the power supply is switched off, and gas in an atomizing chamber is replaced with Ar gas; (2), the gas compressor is started, a variable resistor connected with the nozzle is set to be small, the high-frequency oscillator and the power supply are started, arcing is conducted between the nozzle and the cathode, and plasma flame gas is blown out after being compressed through the plasma gun nozzle; and (3), a plasma gun is integrally moved, and the end face of a bar materials starts to be melted under the thermal energy impact of a plasma flame. The dual-mode plasma arc device and method for rotating electrode atomization have the advantages that the structure is simple, the production efficiency is high, and the method is easy to operate.