The construction of engineering structures on soft ground, loose granular soil and sediments of dune sands always involve with high risks due to lack of sufficient load bearing capacity, excessive settlements and other geotechnical problems. Thus stabilization of the soil in order to achieve a strong subgrade is one of the important issues in the field of geotechnical engineering. Regarding recent advances in nano technology and its impact on all areas of engineering science, the application of this technology in the field of geotechnical engineering seems to provide a promising tool for soil improvement. In this context montmorillonite nanoclay is regardedas a nano material produced from clay minerals and known as a eco-friendly, natural and effective material. The unique properties of nanoparticles have a significant influence on soil properties. The main objective of this research study is to evaluate the shear strength properties and permeability of a typical dune sand stabilized with different amounts of Montmorillonite nanoclay. For this purpose, a series of direct shear tests and constant head permeability tests on the stabilized soil with different amount of nanoclay were carried out to determine the mentioned soil parameters. The direct shear tests were performed on stabilized samples to evaluate the likely effects of various factors such as mixing method, curing time, and the size of the additives particles. The test results showed increasing in the shear strength and cohesion of the soil samples mixed with the nanocaly materials. According to the results, the proper amount of additive of nanoclay found to be about 1% in which the highest increase of 23% at the soil strength was achieved. SEM imaging of the samples showed that nanoclay additive more than 1% caused an increase in the soil porosity due to particles agglomeration. Constant heading permeability tests on the sand samples mixed with nanoclay at various compression ratios of 100, 95 and 90 percent showed a considerable reduction in the permeability of the samples. Keywords Montmorillonite nanoclay, Dune sand, Direct shear test, Permeability