Water level oscillations induced by the ground motion of an earthquake have occasionally been observed in a closed or partially enclosed water system. The generated water disturbances can induce localized flooding, boat collisions, breakage/damage of moored cables due to water disturbances, or even the capsizing of vessels. In this study, the authors focused on cases of seismic water level oscillations in canals and attempted to investigate the potential hazards of and effective countermeasures against them through numerical simulations. The proposed numerical simulation model was first validated by reproducing the water level oscillation that was actually observed at a canal in Mexico City (Xochimilco Canal) during the 2017 Central Mexico Earthquake. The method was then applied to one of the canals in Tokyo (Keihin Canal) to clarify the potential water level fluctuations that can take place due to this phenomenon. The results indicate that while the risks of local inundation would be low, small boats, which can be found in many places in the canal, are at risk of capsizing. Finally, the use of wave-dissipating blocks was found to be an effective countermeasure to decrease the potential for a significant seismic water level oscillation to take place in this canal.