The feasibility of modified tabia (MT) with composite-activated coal gangue (CACG) as the subgrade material of low-grade highways was experimentally investigated. A composite activation method was employed to improve the pozzolanic activity of coal gangue. The effect of CACG content on the mechanical properties of MT was investigated through a series of experiments. It was found that the pozzolanic reactivity of coal gangue was remarkably enhanced by the composite activation method. Compared with traditional tabia (TT), the unconfined compressive strength, splitting strength, and flexural tensile strength of the MT with 50% of CACG content increased by 5.03 times, 9.71 times, and 1.50 times, respectively. The impermeability of specimens with CACG significantly improved. Furthermore, the mass loss rate of MT was less than 2.83%, while it reached up to 34.20% in TT after being conditioned to 40 freeze–thaw cycles. Finally, the microstructure change and hydration mechanism of MT are discussed and revealed.