This article describes the results of experiments examining the competition between the polymer interdiffusion and a cross-linking reaction in poly(2-ethylhexyl methacrylate) latex blend films in which the reactive groups (carboxylic acid and carbodiimide groups) are present in separate latex particles. In this system, polymer diffusion is necessary to bring the reactive groups into proximity, but the reaction creates long chain branches and gel that retard or inhibit further polymer diffusion. To enable measuring polymer diffusion rates by the energy transfer method, the methacrylic acid-containing particles were also labeled with a donor dye, and the -NCN-containing particles were labeled with an acceptor dye. Along with the extent of polymer diffusion, we monitored the growth in gel content as well as the consumption of carbodiimide groups. High gel content in the final film was promoted by factors that maximize the rate of polymer diffusion relative to the rate of the cross-linking reaction: high annealing temperature, low functional group content, and less reactive carbodiimide groups.