A compatibilization strategy for poly(ethylene terephthalate) (PET) and polyethylene (PE) blends to achieve high toughness is described. Maleic anhydride functionalized styrene–ethylene–butylene–styrene (MA-g-SEBS) block copolymer at 20 pph was found to produce an intricate multidomain morphology in which the two major components (50% PE, 50% PET) and the compatibilizer coexist on a hierarchal order. A portion of the PET was dispersed as interconnected rodlike domains oriented along the injection direction. The rest of the PET and the PE constituted beadlike nano domains which served as the matrix. The blend at all these morphological levels responded to deformation in a cooperative fashion giving rise to a super tough material. That is, a blend whose elongation at break (600%) was superior to its two major components (90% for PET and 300% for PE). © 1993 John Wiley & Sons, Inc.