This paper analyses improvement of the strength and durability characteristics of black cotton (BC) soil treated with cement and Class F fly ash for pavements. The increase in cement dosage (3–14%) improved the UCS, but the specimens could not resist WD durability cycles. In order to improve, industrial by-product Class F fly ash was used in addition to the cement. Different combinations of cement (10, 12, and 14%) and fly ash (10, 15, 20, 25, and 30%) replacements were evaluated for strength and durability characteristics. The higher dosage of fly ash reduced the plasticity with uniform distribution of cement cluster formations, leading to higher UCS. The soil mixes with (cement + fly ash) stabilizer combinations (10 + 30), (12 + 30), (14 + 25), (14 + 30) were stable against WD test with soil loss < 14%. Mix with (14 + 25) stabilizer showed a maximum retained UCS of 3.6 MPa at 2.9% moisture content (MC) after 12 WD cycles. However, most of the mixes showed high resistance to the FT test. The retained UCS of FT tested specimens was more due to low variations in moisture content. Mix with (14 + 30) stabilizer showed a maximum retained UCS of 2.6 MPa at 23.3% MC after 12 FT cycles. The soil samples with high cement and fly ash contents, with 90 days curing, can exhibit significant strength and more resistance to WD and FT cycles with soil loss < 14%. After drying, severe damage to WD specimens was observed due to the drastic absorption of water during the wetting cycle. Durable samples showed good plunger penetration resistance with an expansion of < 2%. Scanning electron microscopy (SEM) images showed the formations of cemented interclusters. CSH formed resulted in strength improvement, as observed from XRD patterns. The 7 days cured WD specimens did not exhibit any volume expansion on soaking, thawing in water. A maximum volumetric shrinkage of 3.2% on drying and 1.91% on freezing was observed for stabilized soil. Hence, the stronger and durable stabilized soil mixes with high volume stability can be used for pavements.