The focus of thus study was mainly on the use of scrap poly(ethylene terephthalate) (PET) in poly(butylene terephthalate)-rich blend systems. A good combination of tensile and impact properties was observed in the newly formed blend system with scrap PET. The morphology depicted controlled and well-dispersed phases. The thorough mixing of the constituents was observed in the thermal study. For this innovative blend system, an attempt to correlate the mechanical, thermal, structural, morphological properties and the chemistry of the blend system seemed to be technoeconomical. This study contributed to the recycling of waste material. (C) 2009 Wiley Periodicals, Inc. J Appl Polym Sci 115: 928-934,2010