Abstract: An epoxidized ethylenepropylenediene rubber (eEPDM) was prepared by epoxidation of EPDM and then melt blended with poly(butylene terephthalate) (PBT) for the impact enhancement of PBT. The structure of eEPDM, morphology and properties of PBT/eEPDM were characterized by Fouriertransform infrared spectroscopy, nuclear magnetic resonance, scanning electron microscopy, torque rheometry, dynamic mechanical analysis and mechanical measurements. The results indicated that eEPDM achieved a good dispersion in the PBT matrix in comparison with pristine EPDM at the content lower than 15 wt %. However, the dispersion of eEPDM became worse when the content of eEPDM was higher than 15 wt %. PBT was partially miscible with eEPDM. The addition of eEPDM increased the torque of PBT blends. The incorporation of only 5 wt % eEPDM could generate a significant toughening effect on PBT, which led to an increase in notched impact strength by 100 %.