We study the atomic oxygen adsorption on Pb(111) surface by using density-functional theory within the generalized gradient approximation and a supercell approach. The atomic and energetic properties of purely on-surface and subsurface oxygen structures at the Pb(111) surface are systematically investigated for a wide range of coverages and adsorption sites. The fcc and tetra-II sites (see the text for definition) are found to be energetically preferred for the on-surface and subsurface adsorption, respectively, in the whole range of coverage considered. The on-surface and subsurface oxygen binding energies monotonically increase with the coverage, and the latter is always higher than the former, thus indicating the tendency to the formation of oxygen islands (clusters) and the higher stability of subsurface adsorption. The on-surface and subsurface diffusion-path energetics of atomic oxygen, and the activation barriers for the O penetration from the on-surface to the subsurface sites are presented at low and high coverages. In particular, it is shown that the penetration barrier from the on-surface hcp to the subsurface tetra-I site is as small as 65 meV at low coverage ($Theta $=0.25). The other properties of the O/Pb(111) system, including the charge distribution, the lattice relaxation, the work function, and the electronic density of states, are also studied and discussed in detail, which consistently show the gradually stabilizing ionic O-Pb bond with increase of the oxygen coverage.