Soil consolidation refers to the mechanical process by which soil changes volume gradually in response to a change in pressure. This happens because soil is a two-phase material, comprising soil grains and pore fluid, usually groundwater. When soil saturated with water is subjected to an increase in pressure, the high volumetric stiffness of water compared to the soil matrix means that the water initially absorbs all the change in pressure without changing volume, creating excess pore water pressure. As water diffuses away from regions of high pressure due to seepage, the soil matrix gradually takes up the pressure change and shrinks in volume. The theoretical framework of consolidation is therefore closely related to the concept of effective stress, and hydraulic conductivity. The early theoretical modern models were proposed one century ago, according to two different approaches, by Karl Terzaghi and Paul Fillunger. The Terzaghi’s model is currently the most utilized in engineering practice and is based on the diffusion equation.

In the narrow sense, "consolidation" refers strictly to this delayed volumetric response to pressure change due to gradual movement of water. Some publications also use "consolidation" in the broad sense, to refer to any process by which soil changes volume due to a change in applied pressure. This broader definition encompasses the overall concept of soil compaction, subsidence, and heave. Some types of soil, mainly those rich in organic matter, show significant creep, whereby the soil changes volume slowly at constant effective stress over a longer time-scale than consolidation due to the diffusion of water. To distinguish between the two mechanisms, "primary consolidation" refers to consolidation due to dissipation of excess water pressure, while "secondary consolidation" refers to the creep process.

The effects of consolidation are most conspicuous where a building sits over a layer of soil with low stiffness and low permeability, such as marine clay, leading to large settlement over many years. Types of construction project where consolidation often poses technical risk include land reclamation, the construction of embankments, and tunnel and basement excavation in clay.

Geotechnical engineers use oedometers to quantify the effects of consolidation. In an oedometer test, a series of known pressures are applied to a thin disc of soil sample, and the change of sample thickness with time is recorded. This allows the consolidation characteristics of the soil to be quantified in terms of the coefficient of consolidation (${\displaystyle C_{v}}$) and hydraulic conductivity (${\displaystyle K}$).

Clays undergo consolidation settlement not only the action action of external loads (surcharge loads) but also under its own weight or weight of soils that exist above the clay.

Clays also undergo settlement when dewatered (groundwater pumping) because the effective stress on the clay increases.

Coarse-grained soils do not undergo consolidation settlement due to relativity high hydraulic conductivity compared to clays. Instead, Coarse-grained soils undergo the immediate settlement.