Marine structures like jetties and offshore platforms are constructed on pile foundations. These piles are subjected to significant amounts of lateral loads due to wind, waves and currents. Pile foundations in coastal areas are subjected to scour, imposing additional lateral loads on piles and there are a few cases of failures which can be attributed to scour. In soft clays and sands, scouring can bring significant reduction in the lateral capacity of the piles. Tests are conducted on model pipe piles made up of PVC and Aluminum of outer diameter (D) of 50 mm and length to diameter, L/D ratio of 20. Pile material has been varied to suit the approximate rigidity of piles in the field. Lateral capacities of piles are estimated for eccentricity ratios of 3, 4 and 5 and consistencies of 0.32, 0.48 and 0.60. Eccentricity ratio represents the height of load application. From the earlier studies carried out it has been established that in soft clays the ultimate scour depth, Su can be Su/D=1.0. Tests have been repeated on clay bed with preformed scour hole around the pile. In general marine soils are under submerged condition. Some the tests are repeated with submerged condition. Finite element model of pile and soil is generated. The experimental results are in well agreement with FEM.