This paper presents an effective means of analyzing the safety of a tunnel under dynamic loading in areas with seismic records. A particular case of the railway tunnel in the earthquake-prone regions of the escarpment seismic zone of Ethiopia was the specific focus area of the research. Probabilistic seismic hazard analysis (PSHA) and deaggregation have been conducted to determine the design earthquake required as an input for the dynamic analysis. The PSHA performed by considering the operating design earthquake with conservative assumptions of the local geological features resulted in a peak ground acceleration of 0.36. Two pairs of design earthquake have been obtained from the deaggregation process, which were used to filter acceleration time histories for the selected design earthquake from the ground motion database of Pacific Earthquake Engineering Research Center. Finally, full dynamic analyses of the tunnel have been performed by applying the scaled acceleration time histories corresponding to the structure in the specific site. It was demonstrated how to prove the stability of the tunnel located in difficult ground conditions by performing plane strain analyses with the possible minimum computational efforts.