Introduction: A structurally strong subgrade is always desirable in pavement construction so as to provide a resilient and durable foundation for the subsequent pavement layers for adequate performance under the given traffic load/volume and environmental conditions. Emphasizing the increased awareness for effective waste recycling and demand for a sustainable construction approach, re-utilizing industrial wastes in pavement subgrade construction can be a viable option. The potential re-utilization of bottom ash (BA), an incombustible by-product generated in huge quantities from coal combustion in thermal power plants, in replacing natural soil in the subgrade construction of pavements will not only limit the extent of disturbance to ecological balance through over-utilization of natural soil but also open an avenue for the reuse of bottom ash. Method: In this study, an effort was made to study the possible use of different percentage replacement of BA (0 to 60% with an increment of 15%) with natural soil with and without hydrated lime (5% by weight of soil-bottom ash mix) for applications in road subgrade. Laboratory investigations were conducted for basic soil characteristics, compaction properties, and strength evaluation through California bearing ratio (CBR) and unconfined compressive strength (UCS) tests. Result: The addition of 5% lime to the soil-bottom ash mixes decreased the plasticity index significantly. The highest MDD and the lowest OMC were found in soil with 45% bottom ash. The CBR results of control soil increased from 6.3% to 137.7% for soil-bottom ash mix containing 45% bottom ash and 5% hydrated lime, and the same combination showed a 104% increase in UCS. Conclusion: The observed results indicated that the coupled behavior of the bottom ash and hydrated lime treatment has effectively increased the soil's compaction and mechanical strength and its suitability for use in road subgrade construction.