Recently, considerable efforts have been devoted to the phenomenon of wave-seabed-pipeline interaction. However, conventional investigations for this problem have been concerned with a uniform seabed, despite the strong evidences of variable permeability and shear modulus. In this paper, a finite-element model is proposed to investigate the wave-induced pore pressure, effective stresses, and soil displacements in the vicinity of a buried pipeline in a porous seabed with variable permeability and shear modulus. The numerical results indicate that the inclusion of variable permeability and shear modulus significantly affects the wave-induced soil response around the pipeline. The influence of the variable permeability and shear modulus and geometry of the pipe on the wave-induced soil response around a buried pipeline are also detailed.