In this study, the influence of copolymer composition on the physical properties and the degradation behavior of thermoplastic elastomers based on poly(ethylene oxide) (PEO) and poly(butylene terephthalate) (PBT) segments is investigated. These materials are intended to be used in medical applications where degradability of the implant is desired. PEOT/PBT copolymers are microphase separated and up to four thermal transitions are measured by differential scanning calorimetry. Phase separation in the system is enhanced by increasing the molecular weight of starting poly(ethylene glycol) (PEG) or by increasing the PBT content. The mechanical properties, swelling characteristics and degradation rates of the copolymers are influenced by the phase separation. By changing the PEOT/PBT composition, tensile strengths vary from 8 to 23 MPa and elongations at break from 500 to 1300%. Water uptake ranges from 4 to 210%. The in vitro degradation of PEOT/PBT copolymers occurs via hydrolysis and oxidation. In both cases, degradation is more rapid for copolymers with high contents of PEO. Deterioration of copolymer films takes place when the films are exposed to light in the absence of antioxidant. In preventing oxidation under daylight conditions, Irganox 1330 turned out to be a more efficient antioxidant for the copolymers than vitamin E.