The role of styrene-ethylene/propylene (SEP) diblock copolymer in controlling morphology development of polypropylene/polystyrene (PP/PS) blends was studied by means of small angle laser scattering (SALS) and scanning electron microscopy (SEM). According to SALS, a certain amount of SEP was located at the phase boundary, forming a relatively thick transition layer penetrating into the homopolymers. The thickness of the transition layer was quantified in terms of Debye -Bueche light scattering theory. For PP/PS (1/99) and PP/PS (20/80) blends, the incorporation of SEP into PP/PS blends resulted in a decrease in domain size following an emulsification curve as well as a uniform size distribution, and consequently, a fine dispersion of PP domains in the PS matrix. However, for PP/PS (45/55) blends, the addition of SEP results in a nonmonotonous change in domain size. The morphology fluctuation of the fracture surfaces was analyzed using an integral constant Q based on Debye -Bueche light scattering theories. Variation of Q as a function of the concentration of SEP showed that, due to the penetrating transition layer, adhesion between phases was improved, making it possible for applied stress to transfer between phases and leading to a more uniform stress distribution when blends were broken; accordingly, a more complicated morphology fluctuation of the fracture surfaces appeared.