A series of thermoplastic elastomers based on ethylene oxide-poly(dimethylsiloxane)-ethylene oxide (EO-PDMS-EO), as the soft segment, and poly(butylene terephthalate) (PBT), as the hard segment, were synthesized by catalyzed two-step, melt transesterification reaction of dimethyl terephthalate (DMT) with 1,4-butanediol (BD) and a,x-dihydroxy-(EO-PDMS-EO). Copolymers with a content of hard PBT segments between 40 and 90 mass % and a constant length of the soft EO-PDMS-EO segments were prepared. The siloxane prepolymer with hydrophilic terminal EO units was used to improve the miscibility between the polar comonomers, DMT and BD, and the nonpolar PDMS. The molecular structure and composition of the copolymers were determined by 1 H-NMR spectroscopy, whereas the effectiveness of the incorporation of a,x-dihydroxy-(EO-PDMS-EO) into the copoly-mer chains was verified by chloroform extraction. The effects of the structure and composition of the copolymers on the melting temperatures and the degree of crystallinity, as well as on the thermal degradation stability and some rheological properties, were studied. It was demonstrated that the degree of crystallinity, the melting and crystallization temperatures of the copolymers increased with increasing mass fraction of the PBT segments. The thermal stability of the copolymers was lower than that of PBT homopolymer, because of the presence of thermoliable ether bonds in the soft segments.