The seismic response of elevated liquid storage tanks isolated by the lead-rubber bearing is investigated under real earthquake ground motion. Two types of isolated tank models are considered in which the bearings are placed at the base and top of the tower structure. The tank liquid is modelled as lumped masses referred as convective mass, impulsive mass and rigid mass. The corresponding stiffness associated with these lumped masses has been worked out using the properties of the tank wall and liquid mass based on simple single-degree-of-freedom concepts. The mass of the tower structure is lumped equally at top and bottom. The assembled equations of motion are solved by Newmark's step-by-step method with iteration. The seismic response of two types of tanks, namely slender and broad tanks is obtained and a parametric study is carried out to study the effects of important system parameters on the effectiveness of seismic isolation. The various important parameters considered are the tank aspect ratio, the time period of the tower structure, damping and the lime period of the isolation system. It has been observed that the earthquake response of the isolated tank is reduced significantly. Further, it is observed that the isolation is more effective for the tank with a stiff tower structure in comparison to flexible towers. In addition, a simplified analysis is also presented to evaluate the response of the elevated tanks using a two-degrees-of-freedom model and two single degree-of-freedom models. It is observed that the proposed methods predict accurately the seismic response of elevated liquid storage tanks with less computational efforts.