An automatic frequency modulation circuit and an automatic frequency modulation method using efficiency statistics as a reference for frequency modulation applied to a pulse-width modulation (PWM) system are disclosed. The automatic frequency modulation circuit includes an oscillator unit, an on-time generating unit, a frequency adjusting unit and a frequency selecting unit. The oscillator unit receives a reference current and generate a clock signal. The on-time generating unit, coupled to the oscillator unit, receives a reference voltage and a first voltage of the oscillator unit and generates an on-time signal. The frequency adjusting unit, coupled to the on-time generating unit, receives the on-time signal and a PWM signal and generates a frequency adjusting signal. The frequency selecting unit is coupled to the frequency adjusting unit and automatically adjusts an original frequency according to the frequency adjusting signal to generate an adjusted frequency.