This paper presents a development of elastic core-spun yarn containing a mix of spandex and polyethylene terephthalate/polytrimethylene terephthalate (PET/PTT) bi-component filament as core to obtain better yarn properties, especially for elastic property. Eight types of core-spun yarns, consisting of different core components with various values of linear density and covered with cotton fibers, were produced using a modified ring-spinning machine with a core spinning attachment. The influences of core components, linear density, and draw ratio of spandex on yarn structure and properties were investigated. The experimental results demonstrate that core-spun yarns containing a mix of spandex and PET/PTT bi-component filament have much lower yarn stress decay as well as lower hairiness and CVm value of evenness compared to the yarns using only spandex. For the yarns containing a mix of spandex and PET/PTT bi-component filament, the yarns containing 70 denier spandex have higher elongation and stress decay compared to the yarns containing 40 denier spandex. The test results show that the elongation of yarns containing a mix of spandex and PET/PTT bi-component filament increases with the increase of the draw ratio of spandex. The stress decay of yarns containing a mix of 70 denier spandex and PET/PTT filament shows a similar trend to the elongation. Moreover, the yarn samples containing a mix of spandex and PET/PTT filament as core exhibit good yarn evenness, with very few thick places and neps, as well as low yarn hairiness.