In order to analyze the characteristic of lateral displacement of soft soil foundation under embankment, a typical embankment is studied systemically with nonlinear finite element method, and the location of maximal lateral displacement and its measuring method is also discussed. It is pointed that lateral displacement would be reduced possibly at consolidation stage with strong dry crust and thick soft soil layer, which happened synchronously with vertical settlement increased rapidly. This phenomena could not be measured conveniently with inclinometer pipe, for there are many shortcomings within this technique, although which has been used in engineering widely. It is also shown that the location of the maximal lateral displacement is changeable at different construction stages, which more likely lies in the vertical surface between the toe and the middle of slope of embankment. In order to get the maximal lateral displacement reasonably, it is suggested that the inclinometer pipes should be placed in that area of embankment.