A theoretical formulation based on the linearized potential theory, the Descartes' rule and the extremum optimization method is presented to calculate the critical distance of lifting points of the fully balanced hoist vertical ship lift, and to study pitching stability of the ship lift. The overturning torque of the ship chamber is proposed based on the Housner theory. A seven-free-degree dynamic model of the ship lift based on the Lagrange equation of the second kind is then established, including the ship chamber, the wire rope, the gravity counterweights and the liquid in the ship chamber. Subsequently, an eigenvalue equation is obtained with the coefficient matrix of the dynamic equations, and a key coefficient is analyzed by innovative use of the minimum optimization method for a stability criterion. Also, an extensive influence of the structural parameters contains the gravity counterweight wire rope stiffness, synchronous shaft stiffness, lifting height and hoists radius on the critical distance of lifting points is numerically analyzed. With the Runge-Kutta method, the four primary dynamical responses of the ship lift are investigated to demonstrate the accuracy/reliability of the result from the theoretical formulation. It is revealed that the critical distance of lifting points decreases with increasing the synchronous shaft stiffness, while increases with rising the other three structural parameters. Moreover, the theoretical formulation is more applicable than the previous criterions to design the layout of the fully balanced hoist vertical ship lift for the ensuring of the stability.