When a crystalline Bu2SnO-Bu3PO4 condensate was used as a catalyst for the curing of the Epon 828/DDS system, the addition of hydroxyl group to epoxy group took place. On the basis of this reaction, direct employment of poly(tetramethylene) glycols (PTMG) as toughener for the epoxy resin system was successful. Morphology of the modified resin depended on the molecular weight and the concentration of PTMG. With the incorporation of a small amount of PTMG, the critical fracture energy of the cured resin was improved greatly, while the flexural strength and the modulus were less influenced. A slight enhancement in glass transition temperature (T-g) of the modified resin was found up to the PTMG concentration of 5 phr; further increase of the PTMG concentration caused a significant lowering of T-g.