In this paper, the method of Green’s function is used to investigate the problem of dynamic stress concentration of circular lining and interior linear crack impacted by incident SH-wave. The train of thought for this problem is that: Firstly, a Green’s function is constructed for the problem, which is a fundamental solution of displacement field for an elastic space possessing a circular lining while bearing out-of-plane harmonic line source force at any point in the lining. In terms of the solution of SH-wave’s scattering by an elastic space with a circular lining, anti-plane stresses which are the same in quantity but opposite in direction to those mentioned before, are loaded at the region where the crack existent actually, we called this process “crack-division”. Finally, the expressions of the displacement and stress are given when the lining and the crack exist at the same time. Then, by using the expressions, some example is provided to show the effect of crack on the dynamic stress concentration around circular lining.