Magmatic sills emplaced at shallow-levels are commonly associated with bending and uplift of the overburden. Such phenomena result into domed-shaped structures, known as forced folds whose structural architecture is chiefly controlled by the geometry of underlying intrusions. Several models for host-rock deformation have been proposed and are based on elastic bending-related uplift of the associated overburden. However, the importance of inelastic compaction of overburden for accommodating intruded magma volume has remained underestimated. In this study, we document a forced fold developed above magmatic sills intruded at shallow levels into the sedimentary layers of the offshore Otway Basin, southeastern Australia, from high-quality 3D reflection seismic data. The intruded sills S1 and S2 have an average thickness of 81 m and 223 m, and its emplacement uplifted the paleo-seabed to an average amplitude of 93 m. The intruded sill S2 possess larger contribution in bending the overburden, however, the discrepancy (~65%) between the sill thickness and vertical uplift observed at the paleo-surface, indicates the occurrence of localized host rock deformation caused by pore space collapse and fluidization of shallow buried consolidated sediments. In addition, we assume that the imaged igneous sill may include flakes of sedimentary rocks, which caused an overestimation of the sill thickness, using the widely accepted seismic velocity for mafic intrusions. Our observations imply that porosity reduction due to compaction of both proximal syn-emplacement and post-emplacement sediments, could play a vital role in accommodating this intrusion within the associated stratigraphic succession. Thus, our study provides critical insights into the compaction-related mechanism involved in overburden deformation as a result of sill intrusion.