Efficient use of waste materials is a proven solution to the problems associated with their disposal. Fly ash is one such material produced from thermal power plants that requires a huge disposal area and creates environmental problems. Stabilization of weak soils with fly ash not only improves the engineering properties of soil, but also provide answers to the issues of fly ash disposal. This paper reports the results of laboratory investigation carried out on clayey soil stabilized with fly ash and hydrated lime. Effects of lime, fly ash and the days of curing studied on Unconfined Compressive Strength (UCS), California Bearing Ratio (CBR) and compaction parameters of the stabilized soil were also analyzed. An attempt was made for establishing a relationship between the tensile strength and compressive strength of the 56 days cured stabilized mixes. Brazilian Tensile Strength (BTS) of lime-fly ash stabilized soil at 56 days curing varied in the range of 22 to 143 kN/m2 and UCS from 143 to 2172 kN/m2 . Remarkable strength increase indicates that the clayey soils can productively stabilize with fly ash and hydrated lime.