By using a new system that combines a confocal scanning laser microscope and a rheometer, we observed structural changes and measured shear stress simultaneously in immiscible polymer blends, while they were being subjected to shear flow and an electric field. In three different blends various structural changes were observed, which were all related to the electrorheological effect. These blends were composed of liquid crystalline polymers (LCPs) and oils. In one blend we observed a change from a LCP droplet-dispersed structure to an oil-dispersed one, i.e., a phase inversion, while in another blend there was a change from a LCP droplet-dispersed structure to a network structure. After applying shear flow an oil layer was three-dimensionally observed in the third blend, which had an oil-dispersed structure. In addition, it was found that the layer disappeared under no shear and the annihilation process was accelerated by the application of an electric field. (C) 2003 The Society of Rheology.