A confluence of water and silver-containing products or compounds results in unintentional or intentional discharge of silver species (including silver nanoparticles [AgNPs], free or organic matter-bound Ag+, Ag-halides, or soluble Ag-complexes) into visible light-illuminated waters. To date, little is known about the transformations of Ag species and mechanisms of AgNP formation in light-illuminated waters consisting of components such as bacteria, extracellular polymeric substances (EPS), natural organic matter (NOM), chloride, and/or nitrate. In this work, we demonstrate that in the presence of combinations of water components the transformation of ionic Ag to “new” AgNPs occurs via heterogeneous nucleation followed by (1) light-induced growth mediated by surface plasmon resonance activity of AgNPs, and (2) Ostwald ripening in the absence of light and chloride anions. Further, oxidative dissolution of AgNPs at near-neutral pH (6.8) releases Ag ions, which either complex with the components or form “new” AgNPs depending on solution chemistry. AgNP nucleation and growth on bacterial cells (e.g., Pseudomonas aeruginosa) may cause cell lysis. This study highlights that light-illuminated waters comprising common aquatic components are highly favorable for the AgNP formation over dissolution under neutral pH conditions, in which the presence of chloride accelerates AgNP formation and the reducing capacity of EPS/chloride medium may be greater than NOM (humics and fulvics). Findings of this study suggest that AgNP formation and dissolution may be a continual process and AgNPs thus formed may be stabilized by organic matter, which possibly leads to persistence of the nanoparticles in sunlit waters.