The soil–structure interaction (SSI) effect is nonnegligible during the nonlinear seismic response analysis of large-scale or underground structures. However, the computation of nonlinear response of a structure considering SSI effect usually is a time-consuming process because the numerical model should involve the structure itself, a wide-range soil domain and the soil–structure interface, especially for large-scale structure. This study aims to incorporate the inelasticity-separated finite element method (IS-FEM), which is an algorithm recently developed for efficient structural nonlinear analysis, to improve the efficiency of the soil-structure interaction system. To this end, an inelasticity-separated contact element model for modeling the nonlinear behavior of soil and structure interface is developed in this study. To derive the inelasticity-separated governing equation of this model, a reference elastic stiffness is defined so that the normal and shear deformation of any point pair in the presented contact element is decomposed into reference linear and reference nonlinear parts according to this reference elastic stiffness. As a result, the problem of inconsistency between the requirement of IS-FEM for constant initial linear elastic stiffness and the existence of inflection point for the stress versus relative displacement relationship of contact behavior can be solved. Then, the Goodman element formulation for depicting the nonlinear contact behavior is introduced and an interpolation scheme to establish the reference nonlinear deformation field in an element is incorporated. By combining the proposed model with existing inelasticity-separated elements, a global analytical model of the soil–structure interaction system can be established within the framework of IS-FEM. Because the nonlinearity usually occur in some local regions of the global model and the use of the IS-FEM only require performing these operations for a small scale matrix representing local nonlinearity, the computational efficiency of nonlinear structural response analysis considering SSI effect can be improved significantly. The applicability and efficiency of the proposed method is finally verified by two numerical examples.