Hybrid networks (unsaturated polyester–polyurethane (UP/PU)) of UP resin and PU prepolymer were synthesized and characterized for their phase miscibility with the help of Fourier transform infrared spectroscopy, differential scanning calorimetry, dynamic mechanical analysis (DMA), and atomic force microscopy. The existence of hydrogen bonded –NH groups, broadened glass transition region, and reduced phase domains evidenced the formation of intermixed phase when compared with the parent UP. The optimum mechanical properties of UP/PU hybrid networks were observed at ∼5 wt% PU content. The composites made from treated jute fibers and UP/PU hybrid networks were evaluated for their physico-mechanical properties. DMA curves showed that UP/PU matrix composites had ∼20% higher storage modulus and ∼17% lower tan δ than the polyester matrix composites. The tensile and flexural strengths of these composites were increased by ∼13% and ∼40%, respectively. During accelerated aging, the UP/PU matrix composites retained ∼15% more tensile strength than the polyester matrix composites. Fractographic evidence, such as resin adherence onto the pullout fiber surface, fiber breakage, and adequate adhesion between the jute fibers and the resin, supported the superior properties of UP/PU matrix composites to polyester matrix composites.