A series of liquid-crystalline (LC) diblock copolymers with an azobenzene moiety in the side chain were prepared by atom transfer radical polymerization (ATRP). Using a bromo-terminated poly(methyl methacrylate) as a macroinitiator, the obtained diblock copolymers showed well-defined structures and narrow molecular-weight distributions. Microphase-separated nanostructures with mesogenic blocks in either continuous or separated phases were observed. Owing to varied content of mesogens in the block copolymers, they showed different behavior of photoinduced alignment and holographic recording. Block copolymers with azobenzenes in the majority phases exhibited a similar performance of photoinduced alignment and refractive-index modulation to the azobenzene-containing homopolymer, but their photoinduced mass transportation was partly suppressed by the microphase separation, leading to a lower surface relief than that of the homopolymer. The photoinduced mass transfer was greatly prohibited in the block copolymers with mesogenic groups in the minority phases, resulting in little surface relief. However, refractive-index gratings were still recorded upon local alignment, driven by the photoinduced alignment of azobenzenes or the phototriggered molecular cooperative motion between azobenzenes and nonphotosensitive cyanobiphenyl groups. Then the possible schematic illustrations of mesogens and microphase separation in the grating structures were proposed.