Expanded polystyrene (EPS) Geofoam has long been used as a geotechnical highly compressible and lightweight alternative material with an approximate weight that is less than 1% of natural soils. Several infrastructure projects require the use of large retaining walls with lengthy free heights. The classical backfill behind such walls typically consists of heavy compacted soils, which add more loads and lead to wall outsized dimensions. As a lightweight material, EPS Geofoam significantly reduces the loads imposed on retaining walls and underlying soils, and is not only a soil backfill replacement material but is also intended to solve other engineering challenges. A pilot study intended to characterize the properties and interface behavior of the local EPS Geofoam was planned, including developing a finite element model to simulate the behavior of rigid retaining walls with Geofoam inclusion. Two main concepts of Geofoam inclusion were studied, the reduced earth pressure (REP) and the zero earth pressure (ZEP) concepts. Static loading conditions (at rest and active pressures) were modeled to determine the reduction in the coefficient of lateral pressure after using Geofoam. From the main outcomes, it was found that a 5 cm Geofoam inclusion is enough to make rigid wall of 1 m in height to behave as flexible. It was also found that in some case, the coefficient of lateral earth pressure can be reduced by 50%.