The development of an automatic walking-type pepper transplanter could be effective in improving the mechanization rate in pepper cultivation, where the dibbling mechanism plays a vital role and determines planting performance and efficiency. The objective of this research was to determine a suitable working speed for a gear-driven dibbling mechanism appropriate for a pepper transplanter, while considering agronomic transplanting requirements. The proposed dibbling mechanism consisted of two dibbling hoppers that simultaneously collected free-falling seedlings from the supply mechanism and dibbled them into soil. To enable the smooth collection and plantation of pepper seedlings, analysis was carried out via a mathematical working trajectory model of the dibbling mechanism, virtual prototype simulation, and validation tests, using a physical prototype. In the mathematical model analysis and simulation, a 300 mm/s forward speed of the transplanter and a 60 rpm rotational speed of the dibbling mechanism were preferable in terms of seedling uprightness and low mulch film damage. During the field test, transplanting was conducted at a 40 mm planting depth, using different forward speed levels. Seedlings were freely supplied to the hopper from a distance of 80 mm, and the success rate for deposition was 96.79%. A forward speed of 300 mm/s with transplanting speed of 120 seedlings/min was preferable in terms of achieving a high degree of seedling uprightness (90 ± 3.26), a low rate of misplanting (8.19%), a low damage area on mulch film (2341.95 ± 2.89 mm2), high uniformity of planting depth (39.74 ± 0.48 mm), and low power consumption (40.91 ± 0.97 W).