Polyethylene blends (LLDPE:HDPE approximate to 2:1 by wt) used II NASA’s balloon film applications can be effectively reinforced by addition of a small amount of liquid crystalline polymer (LCP). Cast and blown PE films containing approximate to 10% LCP show an appreciable enhancement in tensile modulus approximate to 400% over that of the neat PE matrix. Anisotropy in these in-situ composites was reduced by controlling LCP molecular orientation via a counter-rotating (C/R) annular die, LCP/PE blend blown films with nearly isotropic properties are obtained,Based on microscopy studies, LCP domains were generally present as fibrils with diameters of approximate to 1 to 3 mu M and lengths of approximate to 100 to 300 mu M. Films, produced using a C/R die, had fibrillated LCP phases and variable orientation through the film thickness, This paper describes the influence of some key process variables including temperature profile, number of extrusion cycles, degree of mixing, adapter geometry, and die counter-rotation on LCP/PE blend film morphology and mechanical properties. The structure of LCP/PE blend blown films was also evaluated using scanning electron microscope (SEM) and wide angle X-ray scattering (WAXS) techniques.