A series of blends have been prepared by adding a novel thermoplastic poly(phthalazinone ether sultone ketone) (PPESK) in varying proportions to diglycidyl ether of bisphenol A epoxy resin (DGEBA) cured with p-diaminodiphenylsulfone (DDS). All the blends showed two-phase structures characterized by differential scanning calorimetry (DSC) and scanning electron microscopy (SEM). Addition of the PPESK resulted in great enhancement of glass transition temperatures (T,) both in the epoxy-rich phase and in the PPESK-rich phase by reason of the special structure of PPESK. There was moderate increase in the fracture toughness as estimated by impact strength. Fracture mechanisms such as crack deflection and branches, ductile microcracks, ductile tearing of the thermoplastic, and local plastic deformation of the matrix were responsible for the increase in the fracture toughness of the blends. (C) 2008 Wiley Periodicals, Inc. J Appl Polym Sci 110: 2253-2260, 2008