Fracture behavior of poly(butylene terephthalate) (PBT) and its rubber-toughened (RT) 10 wt%) grades; ethylene-co-glycidyl methacrylate-co-methacrylate terpolymer-toughened poly(butylene terephthalate) PBT/AX8900 (90/10), and Paraloid acrylic-based rubber-toughened poly(butylene terephthalate) PBT/EX2314 (90/10) was investigated using the fracture mechanics approach. The effects of controlling parameters such as type of impact modifier and deformation rate on fracture behavior of PBT and RT-PBT were investigated. Fracture tests were carried out on notched compact tension (CT) specimens. Fracture toughness, K-c, and fracture energy, G(c), of PBT decreased as the test speed increased from 1 to 500 mm/min. An opposite trend was observed in PBT/AX8900 and PBT/EXL2314. The fracture properties of 30 wt% short glass fiber-reinforced PBT (SGF-PBT) and 10 wt% impact-modified PBT composite (SGF-RT-PBT) were also studied. Incorporation of SGF into PBT has profoundly increased the fracture properties both at high and low speed. However, inclusion of 10 wt% of AX8900 into the reinforced PBT (PBT/AX8900/SGF) (60/10/30) adversely affected the fracture properties. EXL2314, on the other hand, showed a different effect, especially at high testing speed. Both types of impact modifiers were able to retain the flexural strength and flexural modulus of PBT. However, PBT/EXL2314 showed a better retention of flexural properties than PBT/AX8900. Incorporation of SGF in the EXL2314-toughened PBT, i.e., PBT/EYL2314/SGF (60/10/30) also gave a better balance of flexural properties compared to PBT/AX8900/SGF (60/10/30). Both PBT/AX8900 and PBT/EXL2314 showed enhancement of impact strength on the unnotched specimens. The failure modes of CT and impact specimens of PBT, RT-PBTs, and SGF-RT-PBTs were assessed using a scanning electron microscope (SEM). Brittle failure was observed for CT specimens of PBT at high testing speed, while incorporation of the impact modifier AX8900 and EXL2314 resulted in a shift of failure mode from brittle to ductile. SEM micrographs also revealed extensive fiber pull out in SGF-PBT and SGF-RT-PBT.