In our preliminary study, it has been revealed that a copolymer of PE-g-PS can be formed during melt blending of polyethylene/polystyrene (PE/PS) blends via a Friedel-Crafts benzene ring alkylation of the PS. This paper reports our further study on the in situ compatibilization of polyolefin and polystyrene using a single screw extruder. Polyethylene and polypropylene (PP), respectively, have been blended with polystyrene, in the presence of an AlCl3 catalyst system. The mechanical characterization of the PE/PS and PP/PS blends shows significant improvement in tensile elongation. Further characterization of the PE-g-PS copolymer formed in the blends as well as the ungrafted PE and PS suggests a competition between grafting and PS degradation. This in situ compatibilization technique has potential in recycling of mixed polymer wastes.