A poly(butylene terephthalate) (PBT)/linear low-density polyethylene (LLDPE) alloy was prepared with a reactive extrusion method, For improved compatibility of the blending system, LLDPE grafted with acrylic acid (LLDPE-g-AA) by radiation was adopted in place of plain LLDPE. The toughness and extensibility of the PBT/LLDPE-g-AA blends, as characterized by the impact strengths and elongations at break, were much improved in comparison with the toughness and extensibility of the PBT/LLDPE blends at the same compositions. However, there was not much difference in their tensile (or flexural) strengths and moduli. Scanning electron microscopy photographs showed that the domains of PBT/LLDPE-g-AA were much smaller and their dispersions were more homogeneous than the domains and dispersions of the PBT/ T,T PE blends. Compared with the related values of the PBT/LLDPE blends, the contents and melting temperatures of the usual spherulites of PBT in PBT/LLDPE-g-AA decreased.