In order to reveal the correlation between structural damping and structure amplitude of steel structure buildings, the generation mechanism of structural damping related to displacement amplitude was analyzed, and the stickslip friction between walls and steel members was proved to be the cause of displacementdependent nonlinear damping. Based on the stickslip motion principle, the mechanism of nonlinear damping related to displacement amplitude was analyzed theoretically, and the expression of displacementdependent nonlinear damping ratio was deduced. With numerical simulation methods, the accuracy of theoretical derivations was examined, and the effect of parameters including the stiffness of walls and the main structure, the displacement response that makes walls start slipping, the fundamental natural frequency and the material damping on displacement dependent damping was studied. By comparing theoretical results with the field measured data, the reliability of theoretical analysis was verified.