A sixteen-degree-of-freedom (16-DOF) lumped parameter dynamic model taking into account the gravity, eccentricity, bearing clearance, transmission error, and coupled lateral-torsional vibration is established. Based on the dynamical equation, the dynamic behaviors of the spur gear rotor bearing system are investigated by using Runge-Kutta method. The research focuses on the effect of rotational speed, eccentricity, and bearing clearance and nonlinear response of the coupled multibody dynamics is presented by vibration waveform, spectrum, and 3D frequency spectrum. The results show that the rotational frequency of the driven gear appears in the driving gear, and the dynamic characteristics of gears have obvious differences due to the effects of the gear assembly and the coupled lateral-torsional vibration. The bearing has its own resonance frequency, and the effect of the variable stiffness frequency of the bearings should be avoided during the system design. The results presented in this paper show an analysis of the coupled lateral-torsional vibration of the spur gear system. The study may contribute to a further understanding of the dynamic characteristics of such a spur gear rotor bearing system.