By establishing the three-dimensional numerical model of tunnel, this study investigated the effect of seepage erosion on ground settlement and structural deformation. Firstly, the strength and stiffness reduction approaches were adopted to qualitatively simulate the erosion process based on the triaxial erosion tests. Then a comparison of ground settlements between the field monitoring and the numerical result was conducted to verify the reliability of the numerical approach. The effects of seepage erosion on ground settlement and structural deformation were investigated in the end. The results indicated that the ground settlement induced by the progressive erosion process increased exponentially. The linings were pushed upward due to the erosion-induced unloading as seepage erosion occurred on the tunnel crown, and then resulted in a gradual increase of dislocation of segment joints. The extension of erosion region increased the ground settlement and structural deformation according to the parametric study.