Segmented polyether-polyurethanes containing sulfonate groups in the hard segment were modified by the grafting of polyethylene oxide and C12 hydrocarbon chains. The grafts were attached via the sulfonate groups. The physical properties of the materials, including stress–strain behavior, thermal behavior, and water uptake were studied. Grafting was found to alter material behavior significantly. Both the alkyl and polyethylene oxide grafts appear to alter the packing of the hard segments in microdomains because the grafted materials, in contrast to their sulfonated precursor, do not exhibit a melting transition. However, the polyethylene oxide chains appear to interact with the hard segments, probably through hydrogen bonding. For the C12 grafted materials, differential scanning calorimetry showed that a third microphase, consisting largely of C12 chains, may be formed by annealing. Stress–strain and water uptake data support these interpretations. The grafted materials were found to absorb more water than the sulfonated precursor. Most of the water taken up by the C12 material appears to be bulk water whereas for the PEO materials the absorbed water behaves as if it is bound. © 1994 John Wiley & Sons, Inc.