This paper presents the new analytical method for the three-dimensional dynamic interaction problem between a layered soil and embedded foundations with arbitrary shapes. A soil domain is devided into the two subdomains by an artificial cylindrical boundary. A general dispacement field of the outer domain is expanded in a Fourier series and analyzed by the indirect boundary integral equation method which has been developed by authors in a thin layered soil model. The inner domain is discretized by ordinary boundary element method. Combining equations for the total domain are obtained by applying the Fourier inverse technique to the stiffness equations of the outer domain. The method is illustrated by the analysis of a rigid rectangular foundation embedded in an elastic uniform soil. The impedance functions and the foundation input motions are discussed as well as the distribution of soil pressure and the local effects of the side wall.