This paper aims to investigate the use of bio-enzyme to improve the compaction and strength behavior of subgrade soil. The impact of varying bio-enzyme dosages (80, 100, 200, and 300 ml/m3) and curing periods (7, 14, and 28 days) on the engineering properties of soil were evaluated by conducting a series of laboratory tests, including the compaction test, unconfined Compressive Strength (UCS) test, and California Bearing Ratio (CBR) test. The result indicates that the addition of bio-enzyme reduced the Optimum Moisture Content (OMC) and increased the Maximum Dry Density (MDD), UCS, and CBR value of soil up to a certain dosage; beyond that, an opposite trend was observed. It was observed that at the optimum bio-enzyme dosage (i.e., 100 ml/m3), the UCS value improved 2.9 times that of untreated soil, and CBR value improved by 182.4%. The microstructural analyses were performed through a Field Emission Scanning Electron Microscope (FESEM) with Energy-Dispersive X-ray (EDAX) and X-ray Diffraction (XRD) test. It was observed that there was a formation of cementitious compounds in bio-enzyme stabilized soil, which improved the strength. Further, a reduction in the thickness of the pavement section was found after analysis with IITPAVE software.