This study examines the effects of an extended authentic research experience on students' understanding of the nature of science (NOS) and self-efficacy toward science. The curriculum of an introductory physical geology lab was transformed to include a six-week, student-driven research project focused on local groundwater and surface water issues. Students' NOS understanding was measured by using a modified version of the Student Understanding of Science and Scientific Inquiry questionnaire (n = 181) and their science self-efficacy using a modified vocational self-efficacy survey (n = 179). Data were collected on students during four semesters. We found that the combination of having students explicitly reflect on the NOS and working on a research project improves students' overall NOS understanding, and that the increase was higher for female students. We found that for non-STEM students the research project alone had a more positive effect on their NOS understanding. A research project alone did not significantly increase non-STEM students' science self-efficacy, but adding explicit NOS reflections did, and more so for female students. The self-efficacy of STEM students increased more than the one of non-STEM students if they completed both a research project and reflected on NOS concepts. This complex set of results suggests that there are multiple ways to implement an authentic research experience to increase students' NOS understanding, whereas to increase students' self-efficacy, reflections on the NOS are a good strategy, particularly for STEM students. For female students, a promising approach is designing an experiment and reflecting on the NOS.