Abstract: A new image observation system is designed for recording the motion of sand particles during the shaking event in centrifuge tests. It involves high-speed video camera, metro station model and industrial computer. The camera is installed inside the metro station model. With the metro station model shallowly and deeply buried respectively, the motion of sand particles at various elevations is real-time recorded during earthquake occurrence. The digital images at certain stages of the tests are processed by self-developed software named GeoDIP. The micro-mechanism of liquefaction of sandy foundation at different depths are analyzed by the micro-fabric evolutions of sand particles, which includes particle orientation, contact normal and number of particles and porosity ratio. Furthermore, labeled particles are traced to study the micro-mechanism of soil deformation. The test results show that the particle motion at deep depth is similar to piping and there is preferred orientation of vertical direction of the long axis of particles after post-liquefaction drainage. Nevertheless, the motion of shallow particles is similar to sand boil and there is no preferred orientation of particles. The macro response of saturated sandy foundation such as acceleration and excess pore pressure accords with the micro-fabric evolutions of sand particles in centrifuge tests. The results have indicated that the image observation system is a valuable tool that can properly characterize the liquefaction behaviors from microscope and provide an insight into a phenomenon previously impossible.