Liquefaction is a phenomenon where, in simple terms, the soil turns into and earthquake induced quick-sand. Liquefaction is caused by the build-up of pore water pressure, which in turns offsets the gravitational forces of the soil particles. This in turn results in the soil turning to a fluid state, instead of a solid. In order to produce liquefaction, the following are generally required: loose poorly graded sand or silts, ground water, and strong shaking.
When liquefaction occurs, footings can lose bearing support on the soils and underground tanks can “float” to the surface. Sand boils are often produced as sand is forced out of confined ground areas. For more information on liquefaction, see http://en.wikipedia.org/wiki/Soil_liquefaction