It's the larva (called a grub) of one of the scarab beetles. Don't know which one.....are there any beetles that are known to be a problem in your area? Some grubs grow up to be part of a big problem, others nit so much.

Call your local extension office for local suggestions.

As Rhizo stated that is the larva of one of the scarab beetles and as grubs they live on plant roots so they are not good to have in the garden or yard. However, it takes a fairly large number to be much of a problem, one or two per square foot will not do much harm while 10 will.
As you dig around the soil and find a few feed them to the birds. A larger number might need some control. These grubs grow into June Bugs, Japanese Beetles, and another 29,998 beetles we see for a short time each summer.

Thanks guys, I've seen june bugs around sometimes but who knows what these would grow up to be. There were quite a few and who knows if there were more deeper? I read that you can use beneficial nematodes, has anyone had luck with that or know of a good natural way to get rid of them?

I live in zone 6. It is the late October. Is it too late in the year to treat for grubs? Between the grubs and moles my lawn is disintegrating before my eyes.

The best time to treat for grubs is early August, before they hatch from the eggs so what you use has time to get down to where they feed. About now those grubs are moving deeper into the soil and getting ready to hibernate for the winter and probably are not feeding so applying anything that might poison them would be not too productive. The one exception might be Milky Spore Disease, Paenibacillus papillae, to control Japanese beetles although that will not be effective until next year when a new crop of grubs hatches.

Next spring, when the hibernating grubs move back up they will feed for a short time before pupating to become the adults that we see flying around and mating so they can lay the eggs that will become a new generation. For the most part those grubs will be too big for most of the controls to be effective. Perhaps this article could be of some use.

http://ento.psu.edu/extension/factsheets/white-grubs-lawns

kimmq is kimmsr

thank you