Model experiments were performed to determine the controlling parameters in the evolution of the phase morphology of immiscible polymer blends from pellets to micrometre-sized particles. It has been established that during melting in both twin-screw extruders and batch mixers, the dispersed phase is stretched into sheets. These sheets develop into cylinders and the cylinders ultimately break into spherical droplets via Rayleigh-type instabilities. Here, we show that micrometre thick sheets can be created from millimetre-sized pellets by shearing in the parallel discs geometry. Extensional flow is not required to generate the sheets. Pellets are seen to break up in three ways : (1) by stretching into cylinders with drops streaming off the end; (2) by extending sheets that form fingers at the edges; and (3) by stretching into thin sheets that break up by forming holes. A map of the different regions of breakup is given using the Deborah number and the ratio of the first normal stress difference of the matrix to the restoring stress of the pellet (drop). The drop-restoring stress is the sum of the surface stress resulting from interfacial tension and the first normal stress difference of the drop. The masterplot explains why sheets can be easily formed from large drops and gives a window where the sheets are stable and do not form holes.