The mechanism of film formation and crosslinking in a poly(methyl methacrylate/n-butyl acrylate/TMI(R)) (PMBT) and amino-telechelic polybutadiene (PBD-NH2) latex blend was studied. Films cast from the latex blends were ultramicrotomed and examined by transmission electron microscopy. The PBD-NH2 was found to be located primarily at the surface of the PMBT particles due to a crosslinking reaction. Without the possibility of crosslinking (when TMI was absent in the acrylic copolymer), the PBD-NH2 only formed segregated phases in the acrylic polymer matrix due to the incompatibility of the two polymers. While this PBD-NH2 could be extracted with toluene, the PBD-NH2 crosslinked at the PMBT particle surfaces was not extractable. FTIR results showed that the isocyanate groups in the PMBT were completely consumed when the PBD-NH2 concentration was sufficiently high, indicating that the PBD-NH2 had diffused and reacted inside the PMBT particles. Thus, the crosslinking reaction was considered to be the driving force for the diffusion of the PBD-NH2 into the PMBT particles.