In this study, standing wave-induced dynamic response and instability of seabed around a caisson breakwater are investigated. A seabed-rubble-caisson breakwater system is modeled using finite elements. The dynamic response of the porous seabed-rubble foundation is assumed to be governed by the Blot's equations of coupled flow and deformation. Three possible formulations (fully dynamic, partly dynamic and quasi-static) are considered with respect to the inclusion of inertial terms associated with the motion of fluid and solids. The response is presented in terms of stress and pore pressure distributions at three locations underneath the breakwater. The instability of seabed and rubble mound due to instantaneous liquefaction is also studied. The effects of seabed and wave parameters and the effect of inertial terms on the standing wave-induced dynamic response and instability of the system are investigated through a set of parametric studies. Analyses show that quasistatic and partly dynamic formulations yield similar results while the fully dynamic formulation provides different response. The results from different formulations suggest the use of all inertial terms (fully dynamic formulation), providing the most complete solution and the least conservative response. (C) 2010 Elsevier Ltd. All rights reserved.