The invention discloses a floating motor type engine transient dynamic test two-purpose dynamometer. The floating motor type engine transient dynamic test two-purpose dynamometer comprises a foundation, a first transmission shaft bearing support, a second transmission shaft bearing support, a first motor bearing support and a second motor bearing support, wherein the first transmission shaft bearing support and the second transmission shaft bearing support are equipped with a transmission shaft, the transmission shaft is sleeved with a flywheel shaft, the transmission shaft is connected with a transmission shaft and flywheel shaft connector, the flywheel shaft is connected with an inertia flywheel through a flywheel tension sleeve, a dynamometer motor is arranged between the first motor bearing support and the second motor bearing support, an output shaft of the dynamometer motor departing from the transmission shaft is connected with an encoder, and a casing of the dynamometer motor is provided with a pull pressure transducer. The invention further discloses a two-purpose method of the floating motor type engine transient dynamic test two-purpose dynamometer. The floating motor type engine transient dynamic test two-purpose dynamometer is convenient to realize, realizes low cost, is convenient to mount and use, has complete functions, has high work reliability and stability, has high strong practicality and is convenient for popularization and use.