The April 25, 2015 Gorkha earthquake jolted the central region of Nepal causing extensive damage to buildings and earthen structures in both mountainous and urban areas of Nepal. Kathmandu-Bhaktapur road, one section of the Araniko Highway, crosses a small valley in the center of the Kathmandu Basin with an embankment. This embankment and adjacent area were deformed in the earthquake. To examine the cause of this ground deformation, several in-situ tests such as micro-tremor measurements, standard penetration tests (SPT), multi-channel analyses of surface waves (MASW), and C 14 dating were conducted. These tests show that a silty sand layer with low plasticity has most likely been liquefied 5 to 8 meters underground. It is also shown that groundwater lowering using existing wells can decrease the liquefaction-prone area by 81%.