A new structural optimization method of coupled extended finite element method and bound constrained quadratic optimization method (XFEM-BCQO) is adopted to quantify the optimum values of four design parameters for a circular tunnel lining when it is subjected to earthquakes. The parameters are: tunnel lining thickness, tunnel diameter, tunnel lining concrete modulus of elasticity and tunnel lining concrete density. Monte-Carlo sampling method is dedicated to construct the meta models so that to be used for the BCQO method using matlab codes. Numerical simulations of the tensile damage in the tunnel lining due to a real earthquake in the literature are created for three design cases. XFEM approach is used to show the cracks for the mentioned design cases. The results of the BCQO method for the maximum design case for the tunnel tensile damage was matching the results obtained from XFEM approach to a fair extent. The new coupled approach manifested a significant capability to predict the cracks and spalling of the tunnel lining concrete under the effects of dynamic earthquakes.