AbstractThe structure and properties of incompatible polylactide (PLA)/polyamide elastomer (PAE) blends were tailored by a chain extender specifically the styrene–glycidyl acrylate copolymer Joncryl ADR4368 (ADR). Various PLA/PAE/ADR blends with different compositions were prepared by melt blending, and their morphology, crystallization behavior, and mechanical and the shape memory properties were systematically investigated. The results showed a uniform dispersion of PAE particles in the PLA matrix for the PLA blends with a reduction in particle size upon the addition of ADR. The crystallization of PLA was retarded, which was confirmed by a decrease in the melt crystallization temperature and an increase in cold crystallization temperature in the PLA/PAE/ADR blends. Rheological analysis showed an improvement in the melt elasticity of the PLA/PAE binary blend due to the presence of ADR, possibly attributed to the formation of long‐chain‐branched copolymers at the interface. Notably, the PLA/PAE/ADR blend exhibited superior toughness, featuring an elongation at break of 288% and a notched impact strength of 37 kJ·m−2, along with a high shape memory fixation rate and recovery rate when the ADR content was 1 wt%. Furthermore, the underlying toughening mechanism was elucidated. This work may offer an industrially scalable relevant model to fabricate high‐performance PLA materials.