A dynamic bandwidth allocation apparatus of a passive optical network detects guarantee agreement information of each transmission container (T-CONT) queue of at least one optical network unit (ONU) that is connected to the dynamic bandwidth allocation apparatus in order to dynamically allocate a bandwidth is provided. The dynamic bandwidth allocation apparatus sets a queue threshold according to a buffer size of each T-CONT queue of at least one ONU, and calculates a service level agreement (SLA) parameter of at least one ONU using guarantee agreement information and a queue threshold. The dynamic bandwidth allocation apparatus allocates a bandwidth for every frame of each ONU using each SLA parameter of at least one ONU.