This paper reports the analysis and simulation of the catastrophic failure of a compressed natural gas (CNG) fuel tank. The initial analyses of the deformation and cracking patterns, along with the observed fractographic features, were indicative of an internal gaseous combustion. Accordingly, a set of transient-dynamic elasto-plastic finite element (FE) analyses was carried out to simulate the structural response of the tank to a special type of combustion-induced dynamic pressure. The FE model was composed of 3D brick elements equipped with interface cohesive elements for crack growth analysis. Excellent agreements were found between the final simulation results and the observed deformation and fracture patterns. The simulation results clearly revealed that the observed failure characteristics, like the overall asymmetric deformation and fracture patterns, initiation and partial growth of parallel cracks at the same section, multiple cracking at the neck, and the self-similar growth of the main axial crack were all caused by traveling of a deflagration-induced sonic pressure wave from the neck towards the bottom of the tank. Finally, a comparison was made between the characteristics of deflagration-induced and detonation-induced deformation and fracture behaviors of closed-end cylinders.