Granular materials used in engineering structures tend to experience arching under different geotechnical factors. Arching is a factor of load transfer from the destroyed zone to stable areas in these structures. Soil arching plays an important role in stress redistribution, settlement, and load on supports in tunneling. This paper reviews the effect of various parameters on the development of soil arching and formation of expansion and contraction zones around the tunnel. A comprehensive literature review, analysis of new published papers, and investigations were conducted to study the effects of various parameters on soil arching. The results were obtained by studying the formation of shear bands, deformed zones, and their development. The achieved results of investigations show that soil arching and ground deformation around tunnels in sandy grounds are complex phenomena that require careful consideration during tunnel construction. Also the results reveal that despite the arching zone, a loosened zone with non-linear slip surfaces forms above the tunnel. With the onset of tunnel convergence, initial non-linear sliding surfaces appear, and the arching area forms above the tunnel. When tunnel convergence increases, a stable arch forms inside the arching zone, and a de-stressed area as a loosened zone is created under the stable arch. Understanding of soil arching, ground deformation, and the stable arch formed inside the arching zone around tunnels in sandy grounds is very important for the engineers evaluating stress redistribution and load on tunnel supports. Also understanding these issues can help the designers and practitioners make informed decisions during tunnel construction.