Geotechnical assessment of the foundation including engineering geological investigations are essential for important civil structures to provide permanent data set for geological interpretations and for recommendations of suitable engineering measures for the improvement of the foundation. Yaragol Gravity Dam for drinking water is being constructed across Markandaya river in Karnataka State of India. Engineering geological mapping on 1:200 scale was carried out for Housing Chamber of Yaragol Gravity Dam to evaluate the design basis foundation parameters. 2 m x 2 m grids were prepared for mapping of the floor. Based on the field observations and evidences, it was found that the floor area consists of foliated gneiss and granite. No evidence of faulting or shearing was observed on the surface of the floor area. Geotechnical assessment of the foundations was done on the basis of detailed engineering geological mapping and laboratory test results. Classification of rock mass using Rock Mass Rating (RMR) of Bieniawski (1989) has been attempted and based on investigations recommendations for the treatment of foundation were given. Rock type and Rock Mass Rating (RMR) methods were used for assessing the safe bearing pressure of the foundation. Consolidation grouting up to 6 m depth in the foundation using primary at 6 m spacing and secondary holes at 3 m spacing was recommended. After detailed investigations it was found that, the foundation is suitable to locate a housing chamber.