A power-assist system and method for a bicycle, comprising three main sections, namely: a motor section, a speed-reducing section, and a power-assist section. It is capable of operating in four modes, namely: a) the power-assist pedaling mode (where the bicycle rider is pedaling to supply power and the power-assist section is also providing power); b) the pedal only mode (where power is supplied solely by pedaling the bicycle; c) the power-assist only mode (where the bicycle rider is not providing any power by pedaling, and all the power is supplied by the power-output section); and d) a coasting no-power mode where the bicycle is traveling with the pedal section stationary, and no power is being delivered either by the pedal section or the power-assist drive system.