Steel water storage tanks (WSTs) are among the important components of water treatment industry facilities that are expected to remain functional and applicable after strong earthquakes. In this study, the seismic vulnerability of base-isolated steel WST is investigated. A three-dimensional finite element stick model of the targeted tank is created using OpenSees. This model is capable of reproducing convective, impulsive, and rigid responses of fluid-tank systems. Time-history responses of convective displacement, bearing displacement, and base shear force for base-isolated tank subjected to a typical ground motion are compared. Furthermore, time-history analysis based on a suite of 80 ground motions is conducted. The seismic demand models for various responses are established and the most efficient intensity measure (IM) is determined based on the dispersion and coefficient of determination. Seismic fragility curves for different responses are derived for all three damage states using cloud analysis. The results from this study reveal that (i) the convective displacement is significantly greater than bearing displacement; (ii) peak ground displacement (PGD) is the most efficient and sufficient IM for the targeted tank; and (iii) the characteristic of isolation bearing significantly influences the seismic fragilities of convective displacement and bearing displacement and has a little impact on base shear force, which makes the selection of the proper characteristic parameters for isolation bearing very essential. The analysis technique and procedure mentioned above as well as derived insights are of significance to general liquid storage tank system configuration.