Fast acting antibacterial property was introduced to aliphatic-aromatic polyester in the present work without sacrificing its compostability, thermal stability, and mechanical properties. Antibacterial poly(hexamethylene guanidine) hydrochloride (PHMG) was melt mixed with poly(butyleneadipate-co-terephthalate) (PBAT, also called Ecoflex) using a twin-screw extruder in different amounts. The non-reactive blending and uniform mixing was confirmed by nuclear magnetic resonance, gel permeation chromatography, scanning electron microscopy, and energy-dispersive X-ray spectroscopy analysis. The influence of antibacterial agent on compostability, mechanical properties, and thermal stability was studied. The presence of PHMG changed slightly the degradation profile of Ecoflex retaining the extent of degradation almost the same. The antibacterial PBAT showed high thermal stability (degradation starts around 330 degrees C), stress at break 17-20 MPa, modulus 89-127 MPa, and elongation at break more than 700% depending upon the amount of PHMG. The combination of antibacterial activity with biodegradability makes this material a very interesting candidate for many different applications including packaging. POLYM. ENG. SCI., 56:1146-1152, 2016. (c) 2016 Society of Plastics Engineers