Improving the soft clay surrounding an existing pile foundation is an innovative, and cost efficient solution to restrict lateral displacements. However, this technique is not widely used in seismic regions due to lack of fundamental understanding of the behavior of improved and unimproved soils. This study investigates the seismic response of CDSM (cement deep soil mixing) improved soft clays near a pile foundation. Using a sophisticated fully coupled finite element code, the effects of soil improvement and improvement zone dimensions on dynamic behavior of the system are investigated. It is shown that while increasing the lateral dimension of the CDSM can reduce the peak ground accelerations, increasing the depth of the CDSM can increase the peak ground accelerations.