Most of the residential areas in the world consist of soft clay deposits. Shallow foundations, when built on soft clay deposit, exhibit low load-bearing capacity and undergo large settlements. Construction in loose or soft subsurface soil conditions may not sometimes be possible without using a suitable soil improvement technique. The soft clay behavior can be improved by totally or partially replacing inadequate soft soils with granular fill and geogrid being compacted in layers. In the present study, laboratory model tests were carried out to determine the improvement of bearing capacity and settlement behavior of circular shallow foundations supported by a compacted granular fill with and without geogrid. After laboratory tests, numerical analyses were conducted using geotechnical computer software PLAXIS 2D (Finite Element Code for Soil and Rock Analysis). Test results were compared with numerical results. The results of the test and numerical studies indicate that the granular fill and geogrid have considerable effects on the bearing capacity and settlement behavior of the circular shallow foundations.