The paper reports the application of a 3-D direct particle–fluid simulation model to the seepage failure of granular soils. The goal of this study is to numerically capture the process of the failure which is induced by the seepage flow from the micromechanical aspects with no macroscopic assumptions. In order to accomplish this goal, non-cohesive granular assemblies with an upward seepage flow and a variety of pressure gradients are investigated. The motion and the collision of the soil particles are calculated by a soft sphere model, such as the discrete element method, and the flow of the pore fluid is directly solved at a smaller scale than the diameter of the soil particles by the lattice Boltzmann method. By coupling these methods, the interaction between the soil particles and the seepage flow is also considered. As a result of the series of analyses, the numerically predicted value for the critical hydraulic gradient is found to be in good agreement with the theoretical value. In addition, the rapid change in the flow pattern around the critical hydraulic gradient can be microscopically captured. By observing the evolution of the force chains inside the soils, it is demonstrated that the failure process of the contact networks can also be reproduced by the simulation model presented here.