Novel alpha,omega-bis(1,3-oxazolin-2-yl)-terminated oligotetrahydrofurans with number average molecular mass of 2000 and 3700 g mol(-1) were prepared via endcapping of bis(carboxypropyl)-terminated oligotetrahydrofuran with 1,4-bis(1,3-oxazolin-2-yl)-benzene in bulk at 250 degrees C. Such liquid rubbers were added as chain extenders during melt processing of poly(butyleneterephthalate) to produce within a few minutes at 240 degrees C copolyetheresteramides containing oligotetrahydrofuran soft segments. Alternatively, bis(carboxypropyl)-terminated oligotetrahydrofuran together with carboxy-terminated PET were chain extended with bisoxazolines. Thermal, mechanical and morphological properties of the resulting segmented copolyetheresteramides were investigated as a function of reactive processing conditions and oxazoline-functional liquid rubber content and molecular mass.