What characterizes soil liquefaction?

Soil liquefaction is characterized by saturated soil losing its strength when subjected to stress, particularly during seismic activity or sudden loading conditions. In this phenomenon, the pore water pressure within the soil increases, leading to a decrease in effective stress, which can cause the soil to behave more like a liquid than a solid. This reduction in effective stress undermines the soil's ability to support loads, resulting in significant ground deformation, and often leads to problems such as ground failure or settlement.

The other options do not accurately describe liquefaction. For instance, while the first option refers to the compacting of soil under stress, this relates more to how soil typically behaves when compacted, not the instability seen during liquefaction. The third option discusses drying out, which is contrary to the conditions found in liquefaction, as it specifically involves saturated soils. The fourth option addresses a scenario that is more about soil strength enhancement rather than the loss of strength observed during liquefaction. Thus, the defining characteristic is indeed the loss of strength of saturated soil when stress is applied.