Soil pollution seriously threatens the integrity of geotechnical soil properties, considerably altering physical and mechanical characteristics. Therefore, the geotechnical characteristics of contaminated soils should be studied. Samples used in this study were obtained from Peshawar, Khyber Pakhtunkhwa Province, Pakistan. Tests such as Atterberg limits, direct shear strength, sieving analysis, consolidation, and unconfined compression were conducted. The internal friction angle, cohesiveness, and shear strength of the soil decreased when oil pollution was introduced, probably owing to the lubricating effect of oil, which also causes a decrease in the dielectric constant. Surprisingly, in certain cases, bioremediation could reduce soil swelling, relieve pressure from swelling, and prevent soil settlement. Oil contamination resulted in decreased permeability and mechanical strength in the analyzed soil samples. Importantly, the effect of oil contamination on the shear strength parameters is not uniform and depends on the soil type. A thorough study is required because of the long-term consequences of oil contamination, particularly the long-term aging effects on geotechnical soil properties and behavior. Therefore, these results must be compared with those of the most recent tests. Furthermore, future research should consider the complex interplay between the functional groups inherent in soil solids and the injected contaminated oil.