The in situ composites based on poly(ethylene 2,6-naphthalate) (PEN) and liquid crystalline polymer (LCP) were investigated in terms of thermal, rheological, and mechanical properties, and morphology. Inclusion of LCP enhanced the crystallization rate and tensile modulus of the PEN matrix, although it decreased the tensile strength in the PEN-rich phase. The orientation effect of this blend system was composition and spin draw ratio dependent, which was examined by Instron tensile test. Further, the addition of dibutyltindilaurate (DBTDL) as a reaction catalyst was found to increase the viscosity of the blends, enhance its adhesion between the dispersed LCP phases and matrix, and led to an increase of mechanical properties of two immiscible blends. Hence DBTDL is helpful. in producing st reactive compatibilizer by reactive extrusion at the interface of this LCP reinforced polyester blend system. The optimum catalyst amount turned out to be about 500 ppm, when the reaction proceeded in the 75/25 PEN/LCP blend system.