Tsunami hazards have been observed to cause soil instability resulting in substantial damage to coastal infrastructure. Studying this problem is difficult owing to tsunamis’ transient, non-uniform and large loading characteristics. To create realistic tsunami conditions in a laboratory environment, we control the body force using a centrifuge facility. With an apparatus specifically designed to mimic tsunami inundation in a scaled-down model, we examine the effects of an embedded impermeable layer on soil instability: the impermeable layer represents a man-made pavement, a building foundation, a clay layer and alike. The results reveal that the effective vertical soil stress is substantially reduced at the underside of the impermeable layer. During the sudden runup flow, this instability is caused by a combination of temporal dislocation of soil grains and an increase in pore pressure under the impermeable layer. The instability during the drawdown phase is caused by the development of excess pore-pressure gradients, and the presence of the impermeable layer substantially enhances the pressure gradients leading to greater soil instability. The laboratory results demonstrate that the presence of an impermeable layer plays an important role in weakening the soil resistance under tsunami-like rapid runup and drawdown processes.