Bentonite has been considered as a possible additive for the backfill materials in the ground source heat pumps due to its high swelling potential and low hydraulic conductivity. The influence of bentonite on the thermal and moisture diffusion of sand-based backfill materials was addressed in cooling and heating modes in a lab-scale setup. The water holding capacity of the bentonite-enhanced sand blends was also examined. The effect of graphite additive on the thermal conductivity of the sand/bentonite blend was evaluated. At 20% moisture content, the thermal conductivity of the sand/bentonite blend with 5% and 20% blending ratios decreased by about 2% and 16% compared with that of the sand, respectively. The addition of the bentonite promoted the water holding capacity and thermal diffusion of sand. The average thermal conductivities of sand/5% bentonite blend with 5% and 10% graphite additive increased by about 9% and 13% compared with that of the sand/bentonite mixture alone, respectively. At the moisture content of 25%, the thermal conductivity of the sand/bentonite blend with 20% blending ratio for bentonite decreased by about 16% compared with that of the blend with 5% blending ratio. The apparent thermal diffusivity of the sand in the cooling mode was higher than that in heating mode.