Seismic failure of major concrete dams can be disastrous due to sudden release of reservoir water. At the present study, 203 m DEZ arch dam was selected as case study, and two types of nonlinearity were incorporated in seismic analysis of dam, joint nonlinearity and material nonlinearity. The finite element model of the dam, soil, and water was excited using multicomponent maximum design earthquake record which was extracted from seismic hazard analysis of the dam site. Also seismic performance of the dam was evaluated based on linear analysis. The extension of overstressed areas, demand-capacity ratio, and cumulative inelastic duration were used to identify the necessity of nonlinear analysis. It was found that when contraction joints between dam blocks are modeled, the direction of the principal stresses and their distribution patterns are changed meaningfully. In addition, overstress surfaces on the dam body change in comparison with the model without contraction joints.