This paper develops a performance-based seismic design procedure for pallet-type steel storage racks located in areas accessible to the public. Performance objectives for racks consistent with current building code procedures in the United States are defined. The paper focuses on collapse prevention of racks in their down-aisle direction under the Maximum Considered Earthquake (MCE) ground motions at the site. The down-aisle lateral load-resisting systems of racks are typically moment frames utilizing special proprietary beam-to-column moment-resisting connections that may result in large lateral displacements when subjected to MCE ground motions. A simple analytical model that captures the seismic behavior of racks in their down-aisle direction is proposed. The model assumes that the beams and columns remain elastic in the down-aisle direction and that all nonlinear behavior occurs in the beam-to-column connections and the moment-resisting connections between the base columns and support concrete slab. Therefore the behavior is based on the effective rotational stiffnesses developed by the beam-to-column connectors and column-to-slab connections that vary significantly with connection rotation. The model is validated against the results of shake-table tests conducted on full-scale racks under several ground-motion intensities. Finally, the model is incorporated in a displacement-based procedure to verify collapse prevention of racks in their down-aisle direction under the MCE.