Ethylene-glycidyl methacrylate copolymer (EGMA) has been investigated as a reactive compatibilizer for the immiscible and incompatible blends of polypropylene (PP) and a liquid crystalline polymer (LCP). The epoxy functional groups of the EGMA copolymer can react with the carboxylic acid and/or hydroxyl end-groups of the liquid comptalline copolyester. The in situ-formed EGMA-g-LCP copolymer tends to reside along the interface of the PP-LCP and reduces the interfacial tension during melt processing. The compatibilized PP/LCP blends show finer disperse LCP domains and tend to shift the LCP fibrous structure near the skin region of the uncompatibilized blends into the droplet domains. The PP crystallinity in the compatibilized PP/LCP blends is lower than that of the corresponding uncompatibilized blends due to interference in the PP crystallization by the in situ-formed EGMA-g-LCP copolymers. The lower PP crystallinity of the compatibilized blends is reflected in a substantial reduction in stiffness (in terms of the tensile modulus). However, the improved adhesion of the compatibilized blends results in an improvement in the toughness (in terms of the tensile elongation and impact strength).