Lime stabilization is one of the effective ground improvement methods successfully adopted to date for stabilizing expansive and soft soils. The efficiency of lime stabilization depends on soil properties, lime content, compaction, and curing conditions. However, due to durability concerns, the effect of climatic conditions on the long-term performance of lime stabilized soils is gaining importance. The current study discusses the pertinent reactions like carbonation and leaching during the service life of lime stabilized earthworks. Carbonation studies were conducted in a closed cell with accelerated carbonation conditions and relative humidity close to that existing in the field. A manifold arrangement is fabricated to mix gases to the required proportion for the study, and the same was validated using a gas chromatograph. Efforts were made to study the role of two critical parameters like initial lime content and curing period, on the extent and type of carbonation. Also, the effects of carbonation on the mechanical, chemical, and microstructure characteristics of lime stabilized silty clay were assessed. It is observed that the mechanism of carbonation varies with the time at which the reaction takes place. The amount of residual lime in the stabilized soil determines the extent of carbonation and the rate of decalcification of cementitious compounds.