In the present study, the effect of inclusion of waste crumb rubber and cement on the unconfined compressive strength and wet-dry durability of clayey soil has been investigated. Crumb rubber and cement were added to clayey soil at ranges of 2.5%-10% and 3%-6% respectively. The results of the investigation revealed that the incorporation of crumb rubber influenced the unconfined compressive strength, axial strain at failure, energy absorption capacity and wet-dry durability of the cement-stabilized clay. The study reveals that as the content of crumb rubber in the cement-stabilized clayey soil increases the unconfined compressive strength decreases but prosperously changes the behavior of the cement-stabilized clay from brittle to ductile. The axial strain corresponding to peak axial stress and energy absorption capacity of the specimens can be increased by limiting the content of crumb rubber up to 5%. The weight loss of the cement-stabilized clay mixed with crumb rubber increases as the content of crumb rubber increases. With the prolongation of the curing period, the weight loss of cement-stabilized clay mixed with crumb rubber decreases. Further, the weight loss of 90 days cured specimens of clayey soil incorporated with 6% cement and crumb rubber up to 5% meets the recommendation of the material to be used in construction of road pavements as a base, sub-base, and shoulder. Most importantly, the utilization/disposal of this hazardous waste material reduces its impact on environment and health.