AbstractBinary blends of a reactive ketone based polymer with liquid crystalline polymer (LCPA‐950) were studied. The main properties required are flexibility and thermal resistance of material in presence of polyphosphazene, which acts as a compatibilizer. It has been observed that with the addition of LCP the composites showed reduced viscosity during blending and changes in the crystallization of the LCP phase. FTIR study showed that there was a partial interaction between the PEEK and LCP in presence of polyphosphazene. Polyphosphazene is miscible with both PEEK and LCP, which was evident from DMA results. The thermal stability of the composites has been studied by DTA/TGA. The thermal analysis of the blends showed that the degradation process is accelerated by blending, but with the addition of polyphosphazene the onset temperature of first degradation slightly shifted towards higher side than the PEEK/LCP blend. Measurement of the tensile properties showed an increase in the elongation as well as enhanced modulus and strength. From SEM micrographs of tensile fractured surfaces, it was revealed that there is good adhesion between the matrix and dispersed phase upon addition of polyphosphazene to ketone based polymer (PEEK) with LCP. © 2007 Wiley Periodicals, Inc. J Appl Polym Sci 104: 3758–3765, 2007