Liquid storage tanks are used to store drinking, utilizing water and different liquids which are necessary in industry and in energy production. It is known that liquid storage tanks are damaged in many earthquakes. Due to this reason, these structures must be constructed well to be resistant against earthquakes. Therefore, in this study, the formulation of three-dimensional Lagrangian fluid finite element which includes the effects of compressibility and surface sloshing motion is programmed and incorporated into a general purpose structural analysis program SAPIV. And then the static and dynamic behavior of rectangular liquid storage tanks are analyzed by finite element method using the Lagrangian approach, considering liquid-structure interaction. Finally, conclusions drawn from this study are presented, and some recommendations are made.