A precast tolerance concrete shear wall (PTCW) characterized by proper-length steel connectors is proposed to adjust the tolerance and improve the joint failure model of the precast wall. The design method for this wall is also presented in this study and verified by test results. Four full-scale walls, including two cast-in-situ walls (RCWs) and two precast walls (PCWs) with axial compression ratios of 0.2 and 0.3, respectively, were tested under lateral loading. The seismic behavior of the panels, including the failure modes, hysteretic behavior, strength envelope curves, stiffness degradation, energy dissipation, and steel strains, was analyzed and discussed herein. The test results showed that all four walls were in a flexural-shear failure mode, and the PCWs showed better performance in terms of hysteretic behavior, strength envelope, stiffness, and energy dissipation, particularly under an axial compression ratio of 0.3. Furthermore, the peak load of PCW1 (axial compression ratio is 0.2) and PCW2 (axial compression ratio is 0.3) increased by 5.93% and 15.51%, and the yield load increased by 12.1% and 11.39% compared with those of RCW1 (axial compression ratio of 0.2) and RCW2 (axial compression ratio of 0.3), respectively. The equivalent viscous damping coefficients of all four panels were higher than 0.05. The lateral bearing capacity of the walls increased with an increase in the axial compression ratio. Moreover, no visible damage or slippage was observed when the PCWs were demolished after testing. The main nonlinear strain was concentrated on the vertical bar and not on the connectors, indicating that the plastic hinge position was transferred from the joint interface to the wall panel. The results indicated that the use of steel connectors to strengthen the joints can achieve the seismic design concept of strong joints and weak members.