The structural development of poly(butylene terephthalate) (PBT) fibers was analyzed using in situ wide angle X-ray diffraction and fiber temperature measurements during CO2 laser-heated drawing, in which the necking position on the running fiber could be fixed by CO2 laser irradiation. The measured parameters were determined as functions of the elapsed time after necking with a time resolution of 0.3 ms. The as-spun PBT fibers, which exhibited a low-oriented α-crystalline structure, were drawn to a draw ratio of 5 using laser heating. The (001′) reflection, which indicates a quasi-smectic fibrillar structure, was not observed before crystallization in contrast to measurements of poly(ethylene terephthalate) (PET) and poly(ethylene 2,6-naphthalene dicarboxylate) (PEN). The α-crystal was transformed into an oriented β-form crystal at the necking position, and the developed β-crystallites exhibited increased size and altered orientation <2 ms after necking. The fiber temperature increased rapidly at around Tg, and the rearrangement of the β-crystal primarily occurred as the fiber’s temperature rose from 100 to 160 °C. The oriented β-crystal of the drawn fiber transformed into the oriented α-crystal when the drawing tension was released. The structural development during the CO2 laser-heated drawing of low-oriented α-crystalline as-spun PBT fibers was analyzed with a time resolution of 0.3 ms. The α-crystal was transformed into an oriented β-form crystal at the necking position, and the crystallite size and orientation were increased <2 ms after necking at the temperature of 100–160 °C. In contrast to the PET and PEN, quasi-smectic structure was not observed before crystallization. The oriented β-crystal of the drawn fiber transformed into the oriented α-crystal when the drawing tension was released.