To dispose of the large amount of OSA (oil shale ash) and FA (fly ash) in Northeast China, a novel subgrade material obtained by modifying SC (silty clay) with OSA and FA was produced. First, the effect of F-T (freeze-thaw) cycles and stress states on the resilient modulus of unmodified SC and the modified SC were investigated. Second, the damage ratio was introduced to describe the relationship of resilient modulus versus F-T cycles. Third, the effect of F-T cycles on the microstructure of soils was investigated. The results indicate that in addition to stress state, resilient modulus is significantly influenced by F-T cycles. For unmodified SC, the resilient modulus continually decreases with increasing F-T cycles. As for the modified soil, the resilient modulus decreases sharply after the first F-T cycle and then tends to be stable. The damage ratio and its fitting equation are effectively adopted to describe the variation characteristic of the resilient modulus after F-T cycles. As observed from SEM testing, the effect of F-T cycles on soils is to destroy the initial structure and increase the porosity of soils. It could be concluded that the microstructure change during F-T cycles is the main factor that results in the decrease of the resilient modulus.