Octocorals are the main foundation species in rocky-wall marine communities in the Tropical Eastern Pacific; however, we have only a poor understanding of how stable these communities are. This study is the first attempt to quantify complex stability properties, such as turnover and recovery time for octocoral species. We use a Markov Chain model with transition probabilities estimated from the field and compare 2 oceanographically distinct gulfs within the same latitude in Pacific Panama: the Gulf of Panama (GP) and the Gulf of Chiriqui (GC). The model was parameterized by monitoring 4 fixed plots (1 m²) at 8 sites from June 2014 to January 2016. The state (occupation) of each point (location) occupied by the holdfast of an octocoral colony was recorded during each survey. Thirteen octocoral species were monitored over 989 points. Octocoral dynamics in GC, where communities were more species-rich, were 3 times more stable than communities in GP, with an estimated turnover time of 4.8 yr in GC and 1.5 yr in GP. However, communities in the GC took 1.6 times longer to recover after disturbance, with an estimated species-specific recurrence time of 34 yr in GC and 21 yr in GP, possibly due to strong competition for space with other sessile organisms. In modeled communities, the effect of diversity loss was low at the gulf and study region, but increased significantly at the reef scale, especially in species-poor sites. Additional studies on environmental factors driving stability are needed to fully understand the mechanisms behind our results.