Abstract Using small angle neutron scattering and neutron spin echo spectroscopy, two isotopic blends of low molar mass polydimethylsiloxane (PDMS) and polyethylmethylsiloxane (PEMS), and the corresponding binary blends d-PDMS/ p-PEMS and p-PDMS/d-PEMS (d: deuterated, p: protonated) were studied at the critical composition in the homogeneous regime. From the scattering data it becomes evident that coil dimensions and collective dynamics of these both blend systems behave significantly different. Compared to the isotopic mixtures, which exhibit the expected unperturbed chain dimensions and the typical Rouse relaxation, in the binary blends, which differ by a large shift with respect to the critical temperature, considerable coil expansion and spatially restricted Rouse relaxation occur. Both these structural and dynamic effects are in agreement with the model of droplet formation and chain localization, resulting from the existence of microscopic heterogeneities within the spinodal boundaries of the phase diagram. In addition, the observation of Rouse relaxation, spatially restricted to microscopic length scales, provides a new access to the molecular understanding of the critical slowing down of the mutual diffusion process, observed by photon correlation spectroscopy.