<p>This paper investigates the potential and nonlinear dynamics of an inertial energy harvester based on a horizontal axis flywheel enclosed in a floating hull. Two numerical modeling approaches are presented and compared, namely a block-based model and an analytical Lagrangian model using quasi-coordinates. The free (unloaded) response to external excitation is first analyzed to qualify the type of response of the system, especially focusing on the operational regions that may lead to periodic or chaotic response, and quantify the related potential for energy extraction. Secondly, the effect of the action of energy conversion is considered via the inclusion of a slowly variable power take-off damping, particularly evaluating if and how it undermines the underlying potential of the unloaded system; regimes of oscillation, rotation, and chaos are particularly highlighted, considering their effectiveness for power production. Periodic rotational solutions are the most promising for energy harvesting and are achievable for a wide range of excitation conditions; however, the sensitivity of optimal parameters and abrupt changes of performance between periodic and chaotic regions pose a challenge, calling for robust optimization design and optimal control.</p>