Rheological, mechanical, and adhesive properties have been studied of two-phase polymer blends containing a liquid crystal copolyester of poly(ethylelene terephthalate) and p-hydroxybenzoic acid plus isotactic polypropylene (PP) with varying compositions and concentrations of glass fibers. Perfect fibrillation of the disperse LC-phase into the PP-matrix in capillary flow was observed at LCP concentrations >20 wt% and temperatures >488 K. This effect leads to a decrease of blend viscosity and a reinforcing of the extrudate’s mechanical characteristics. At the same time, more essential reinforcement is achieved by the simultaneous addition of the reinforcing agents both of the LCP and glass fibers. Processing of PP is not impaired. It was found that the adhesive strength increases substantially when the amount of LCP in the blend exceeds a definite level, corresponding to a phase inversion. The results are explained by the formation near the interface of two adhesion layers : the first is composed of pure LCP having a higher surface tension, whereas the second layer represents the blend of various compositions. At small amounts of LCP, the adhesion failure proceeds in the interphase between the LCP and the blend. After the phase inversion, where adhesion strongly increases, the failure of adhesion joints proceeds near the interface between LCP and the glass.