Polyethylene (PE) has the potential to become a promising carbon fiber (CF) precursor in terms of excellent melt-processibility, high carbon content (>85 wt %), and low material cost. However, the PE polymer is completely degraded at temperatures >480 °C under an inert atmosphere. In this study, we have investigated CF precursors based on a PE-g-PAH graft copolymer with several grafted PAH (polyaromatic hydrocarbons from a petroleum pitch) side groups and some ungrafted (free) pitch molecules that serve as precursors and plasticizers to lower its melt viscosity during melt-spinning. The presence of grafted PAH groups in the PE chain not only enhances the compatibility between the PE-g-PAH copolymer and free pitch molecules in the precursor but also assists in the one-step thermotransformation process to achieve a high C-yield. Thermogravimetric (TGA) analysis, evolved gas analysis mass spectrometry, oscillating rheology, solid-state 13 C NMR, Raman spectroscopy, and X-ray diffraction were employed to monitor melt-processing and thermal transformation. Melt-spinning of this PE-g-PAH/Pitch blend precursor is suitable in the temperature range of 320−340 °C. Thermal transformation, including crosslinking, dehydrogenation of the PE chain, and carbonization, happens stepwise between 350 and 1000 °C under a noble gas atmosphere. Compared with the corresponding petroleum pitch, this PE-g-PAH/Pitch blend precursor exhibits a higher carbon yield (>70%) at 1000 °C. The resulting carbon derived from this precursor (without tension) at 1100 °C shows a similar d-spacing and stacking height but a higher lateral size compared to those typically observed in PAN-based carbon fibers. Overall, the discovery of this PE-g-PAH/Pitch precursor potentially provides an alternative strategy for preparing carbon fibers with a lower cost, less energy consumption, and easier handling throughout the entire production process.