Bacterial transformation is an important mode of horizontal gene transfer that helps spread genetic material across species boundaries. Yet, the factors that pose barriers to genome-wide cross-species gene transfer are poorly characterized. Here, we develop a replacement accumulation assay to study the effects of genomic distance on transfer dynamics. Using Bacillus subtilis as recipient and various species of the genus Bacillus as donors, we find that the rate of orthologous replacement decreases exponentially with the divergence of their core genomes. We reveal that at least 96% of the B. subtilis core genes are accessible to replacement by alleles from Bacillus spizizenii. For the more distantly related Bacillus atrophaeus, gene replacement events cluster at genomic locations with high sequence identity and preferentially replace ribosomal genes. Orthologous replacement also creates mosaic patterns between donor and recipient genomes, rearranges the genome architecture, and governs gain and loss of accessory genes. We conclude that cross-species gene transfer is dominated by orthologous replacement of core genes which occurs nearly unrestricted between closely related species. At a lower rate, the exchange of accessory genes gives rise to more complex genome dynamics.