In order to investigate the compatibility between external wall panel and floor-by-floor assembled steel braced frame under actual earthquake excitation, a three-story structural model was designed in which the external PC composite wall panels were connected to the steel frame by flexible aseismic connectors. The full-scale shaking table test was conducted focusing on the dynamic damage evolution mechanism and deformation characteristics.The test results show that the floor-by-floor assembled steel braced frame with external PC composite wall panel is able to meet the safety requirement of the design code. Meanwhile, the structure demonstrates the characteristics damage-controlled behavior and small residual displacements. Under frequent occurring earthquakes, the frame and the wall panels are not damaged. Under design basis earthquakes, the frame kept elastic and minor damage occurred in the wall panels. Under maximum considered earthquakes, the damage was controlled in the slender braces, while the beam-column frame kept elastic and no significant damage was observed in the wall panels and their connectors. Under extremely strong earthquake, the beam flange yielded; the wall panel connection was damaged and cracking was observed at the edge and near the embedded parts of the wall panels, but the main body of the wall panels was almost intact. The PC composite wall panels externally hanged on with the innovative flexible damping connectors did not affect the deformation recovery of the floor-by-floor assembled steel braced frame, demonstrating good deformation compatibility with the main steel frame. With external wall panels, the structure showed improved uniformity of story drift. The external wall panel can significantly increase the stiffness of the structure in the case of braces slacking, thereby reducing the inter-story displacement response and torsional response of the structure, and weaken the impact effect due to the dynamic tension of the slender braces. In conclusion, the floor-by-floor assembled steel braced frame with an external wall showed outstanding seismic performance and post-earthquake resilience.