The blends of thermoplastic polyether-based urethane elastomer (TPEU) and monomer casting polyamide 6 (MCPA6) were prepared using -caprolactam (CL) as a reactive solvent, and CL sodium as a catalyst at various TPEU contents (2.5-15 phr by weight). In situ anionic ring-opening polymerization and in situ compatibilization of TPEU/MCPA6 blends were realized in one step. The dissociated TPEU chains acted as macroactivator to initiate MCPA6 chain growth from the TPEU chains. The formed block copolymers (TPEU-co-MCPA6), which have been confirmed by Fourier transform infrared spectroscopy and 1 H-NMR analysis, improved the compatibility between TPEU and MCPA6. In addition, both differential scanning calorimetry and dynamic mechanical analysis studies revealed that the crystallinity temperature, melting temperature, the degree of crystallization, and the glass-transition temperature of MCPA6 component remarkably shifted to a low temperature with increasing TPEU content. Mechanical properties demonstrated that the impact strength and the elongation-atbreak of the blends significantly increased with the content of TPEU, whereas a progressive decrease occurred in tensile strength, flexural strength, and flexural modulus. WAXD spectra showed that only ␣-form crystal of PA6 component existed in the TPEU/MCPA6 blends. Furthermore, scanning electron microscopes (SEM) of the cryo-fractured surfaces confirmed a substantially improved compatibility, and reflected a seemly single-phase morphology. POLYM. ENG. SCI., 46: 1196 -1203, 2006.