A　numerical　method　based　on　nonlinear　incremental　dynamic　analysis　is　proposed　in　this　paper　to　develop　seismic　fragility　curves　for　rectangular　subway　station　buried　in　layered　soil　and　subjected　to　transverse　seismic　excitations.　The　proposed　method　primarily　consists　of　four　parts,　namely,　model　verification,　damage　quantification,　ground　motion　processing,　and　seismic　performance　assessment.　The　main　section　of　the　Daikai　subway　station　collapsed　during　the　Kobe　Earthquake　is　used　as　an　example　to　demonstrate　the　detailed　procedure　of　the　proposed　method　in　construction　of　seismic　fragility　curves　for　underground　structures.　Results　from　the　nonlinear　soil-structure　interaction　model　in　this　paper　is　firstly　verified　against　the　results　from　existing　literature.　The　threshold　values　of　different　damage　states　of　the　underground　structure　are　quantified　by　interstory　drift　ratio　obtained　from　the　nonlinear　static　pushover　analysis　of　the　soil-structure　interaction　system.　Based　on　the　results　of　the　incremental　dynamic　analysis,　it　is　found　that　the　peak　acceleration　at　the　ground　surface　is　an　efficient　and　appropriate　intensity　measure　of　the　ground　motions　for　shallowly　buried　underground　structure.　The　proposed　method　is　validated　by　comparing　with　the　existing　empirical　and　numerical　seismic　fragility　curves　of　buried　rectangular　underground　structures　and　can　be　used　as　an　effective　approach　in　the　development　of　seismic　fragility　database　for　underground　structures.