Lateral buckling of pipelines with closely spaced imperfections laid on even seabed with nonlinear soil-pipe interaction is investigated using finite element analysis (FEA). An analytical solution for lateral buckling of pipeline with single imperfection is proposed and is used to validate the FEA. Effects of amplitude, half wave-length and spacing of imperfections as well as soil resistance on lateral buckling response are presented. It is found that at imperfection spacing greater than half the imperfection half wave-length, there will be no interaction between the buckle lobes. Using validated FEA, the collapse of the pipe-wall due to the interaction between lateral buckling and external pressure is studied. Buckle interaction envelopes are developed and compared to recommendations of the DNV standard. It is shown that in pipeline with closely spaced imperfections, the lateral curvature at the onset of buckling is as large as the critical collapse curvature under combined bending and external pressure.