The system involves lining the walls and floor of the tank excavation with an impervious synthetic membrane, prior to placement of the tanks in the excavation. The membrane, made of a tough reinforced plastic material, are prefabricated or assembled at the jobsite and thermally "welded" together to form a continuous barrier. A sump is normally designed in the floor of the liner. Should a tank leak later occur, spilled product will collect in this sump, where its presence can be detected through use of an observation well. The precise source of the leak, however, cannot be identified.