This study investigated the precipitation of three types of end-functionalised Liquid rubber (two CTBN and one ATBN) from two homologous series of amine-cured epoxy polymers with variable cross-link density. The CTBN carboxyl endgroups strongly enhanced the curing rate through the impurity catalysis mechanism, however, the amino-terminated ATBN only retarded the reaction, possibly by dilutional effects or owing to changes in the dielectric constant of the reacting medium. The glass transition temperature (T-g) of the epoxy phase was depressed by CTBN rubber dissolved in the epoxy matrix and the T-g of the CTBN rubber was also lowered. The height of the DMTA rubber peak was a linear function of the level of CTBN and suggested that ca. 3% of the rubber was dissolved in the cured epoxy matrix. The microstructure of the rubber particles was studied by SEM and related to the kinetics and thermodynamics of phase separation. (C) 2000 Elsevier Science Ltd. All rights reserved.