The melt blending of polylactide (PLA) and thermoplastic polyurethane (TPU) elastomer was performed in an effort to toughen the PLA. The phase morphology, mechanical properties, and toughening mechanism of the PLA/TPU blends were investigated. The results indicate that the spherical TPU particles dispersed in the PLA matrix, and the uniformity decreased with increasing TPU content. There existed long threads among some TPU droplets in blend with 30 wt % TPU. TPU improved the toughness of the PLA. With 30 wt % TPU, the elongation at break of the blend reached 602.5%, and samples could not be broken in the notched Izod impact tests at room temperature. The matrix ligament thickness of the PLA/TPU blends was below the critical value, and the blends deformed to a large extent because of shear yield caused by debonding, the formation of fibers upon impact; this dissipated a large amount of energy. (C) 2011 Wiley Periodicals, Inc. J Appl Polym Sci 120: 3217-3223, 2011