The relaxation behavior of simultaneously and sequentially biaxially stretched PET films was studied at the rubbery state stretching temperatures. The primary objective was to investigate the influence of process conditions and the mode of deformation on the structural changes that take place in the stretched films. Using an instrumented biaxial stretcher, the films were stretched and held at the stretching temperature at fixed dimensions while true stress, true strain, in- and out-of-plane birefringences were monitored. The relaxation behavior was found to be dependent on the process prehistory including extent and rate of deformation. The behavior was divided into three regimes: Regime I, where the birefringence and strain always decrease and the material remains in the amorphous state. Regime II, where both the birefringence and strain first decrease while the film remains amorphous; then they start to increase when the first evidence of strain crystallization appears. Regime III, where strain-induced crystallization was already well-established during the biaxial deformation; both strain and birefringence increase during relaxation. This three-regime behavior was directly linked to the formation of strain-induced crystallization. Off-line Raman spectroscopy, DSC measurements, and X-ray WAXS patterns were used to follow the structure evolution and the transitions between these regimes.