This paper develops an identification scheme to investigate the dynamic behaviour of isolated structures in which laminated rubber bearings are used. A linear model is used for the superstructure while a bilinear hysteretic model is chosen for the isolation system. The modal parameters of the superstructure are estimated on the basis of an iterative identification algorithm and are employed to identify the parameter values of the isolation system. The essence of this study is the application of the Masing criterion by which hysteretic loops of bearings may be characterized through the skeleton curve. The multivalue restoring force is then transformed into a single-value function so that the ordinary identification process can be carried out with only minimal computational effort beyond that required for the identification of a linear system. Numerical examples include the four-storey Foothill Communities Law and Justice Center in California and show the feasibility of the proposed technique for identifying the hysteretic isolation system.