The stone columns are increasingly being used as a soil improvement method for supporting a wide variety of structures (such as road embankment, buildings, storage tanks etc.) especially built on soft soil. Soil improvement by the stone column method overcomes the settlement problem and low stability. Nevertheless, stone column in very soft soils may not be functional due to insufficient lateral confinement. The required lateral confinement can be overcome by encasing the stone column with a suitable geosynthetic. Encasement of stone columns with geogrid is one of the ideal forms of improving the performance of stone columns. This paper presents the results of a series of experimental tests and numerical analysis to investigate the behavior of stone columns with and without geogrid encasement in soft clay deposits. A total of six small scale laboratory tests were carried out using circular footing with diameters of 0.05 m and 0.1 m. In addition, a well-known available software program called PLAXIS was used to numerical analysis, which was validated by the experimental tests. After good validation, detailed of parametric studies were performed. Different parameters such as bearing capacity of stone columns with and without geogrid encasement, stiffness of geogrid encasement, depth of encasement from ground level, diameter of stone columns, internal friction angle of crushed stone and lateral bulging of stone columns were analyzed. As a result of this study, stone column method can be used in the improvement of soft ground and clear development in the bearing capacity of the stone column occurs due to geogrid encasement. Moreover, the bearing capacity is effected from the diameter of the stone column, the angle of internal friction, rigidity of the encasement, and depth of encasement. Lateral bulging is minimized by geogrid encasement and effected from geogrid rigidity, depth of encasement and diameter of the stone column.