The morphology of immiscible and highly incompatible blends of Sorona(R) polymer [Poly(trimethylene terephthalate), PTT] and ethylene propylene diene rubber (EPDM) blends has been studied with and without the addition of a compatibilizer precursor EPM-g-MA. These incompatible blends are characterized by a two-phase morphology, narrow interphase, and poor physical and chemical interactions across the phase boundaries. Therefore. a reactive route was employed to compatibilize these blends by the addition of maleic anhydride grafted ethylene propylene rubber (EPM-g-MA). The blends were prepared in an internal mixer. The morphology was examined by scanning electron microscopy (SEM) after preferential extraction of the minor phase. The SEM micrographs were quantitatively analyzed for domain size measurements. The morphology of the blends indicated that the EPDM phase was preferentially dispersed as domains in the continuous Sorona(R) matrix up to 30% of its concentration. A co-continuous morphology was observed above 30 wt% of EPDM content followed by a phase inversion beyond 60 wt% of EPDM. The influence of EPM-g-MA on the phase morphology of blends was studied quantitatively by SEM. It was found that the addition of EPM-g-MA reduces the domain size of the dispersed phase followed by a leveling off at higher concentrations of the compatibilizer. This is an indication of interfacial saturation. The experimental compatibilization results were compared with theoretical predictions. The conformation of the compatibilizer at the interface was analyzed based on the area occupied by the compatibilizer at the blend interface. Free volume measurements using positron annihilation lifetime spectroscopy (PALS) were done to analyze the interaction of blends. In the case of uncompatibilized blends the free volume values tend to increase by the addition of EPDM phase showing high level of incompatibility. Addition of EPM-g-MA to the blends tends to decrease the free volume showing its compatibilizing effect. (C) 2004 Elsevier Ltd. All rights reserved.