Inherent brittleness and low heat resistance are the two major obstacles that hinder the wide applications of poly(L-lactide) (PLLA). In this study, we report a fully biobased, highly toughened and heat-resistant PLLA ternary blend, which was prepared by dynamic vulcanization of PLLA with poly(D-lactide) (PDLA) and an unsaturated bioelastomer (UBE). The results indicated that during dynamic vulcanization PDLA cocrystallized with PLLA to form stereocomplex (SC) crystallites, which not only enhanced the molecular entanglement but also accelerated the crystallization rate of PLLA matrix. With increase in the content of PDLA, the matrix molecular entanglement increased while phase-separation was enhanced, which enabled the impact strength to increase first and then decrease. The ternary blends containing 10 wt.% PDLA showed the highest impact strength. The presence of SC crystallites makes it possible to achieve a fully sustainable PLLA/VUB/PDLA ternary blend with highly crystalline matrix under conventional injection molding, due to the high nucleation efficiency of SC towards crystallization of PLLA. The highly crystalline ternary blend showed excellent heat resistance and better impact toughness than high impact polystyrene.