The compatibilizing effect of poly(hexamethylene oxide) (PHMO) on the synthesis of polyurethanes based on alpha,omega-bis(6-hydroxyethoxypropyl) poly(dimethylsiloxane! (PDMS) was investigated. The hard segments of the polyurethanes were based on 4,4'-methylenediphenyl diisocyanate (MDI) and 1,4-butanediol. The effects of the PDMS/ PHMO composition, method of polyurethane synthesis, hard segment weight percentage, catalyst, and molecular weight of the PDMS on polyurethane synthesis, properties, and morphology were investigated using size exclusion chromatography, tensile testing, and differential scanning calorimetry (DSC). The large difference in the solubility parameters between PDMS and conventional reagents used in polyurethane synthesis was found to be the main problem associated with preparing PDMS-based polyurethanes with good mechanical properties. Incorporation of a polyether macrodiol such as PHMO improved the compatibility and yielded polyurethanes with significantly improved mechanical properties and processability. The optimum PDMS/PHMO composition was 80 : 20 (w/w), which yielded a polyurethane with properties comparable to those of the commercial material Pellethane(TM) 2363-80A. The one-step polymerization was sensitive to the hard segment weight percentage of the polyurethane and was limited to materials with about a 40 wt% hard segment; higher concentrations yielded materials with poor mechanical properties. A catalyst was essential for the one-step process and tetracoordinated tin catalysts (e.g., dibutyltin dilaurate) were the most effective. Two-step bulk polymerization overcame most of the problems associated with reactant immiscibility by the end capping of the macrodiol and required no catalysts. The DSC results demonstrated that in cases where poor properties were observed, the corresponding polyurethanes were highly phase separated and the hard segments formed were generally longer than the average expected length based on the reactant stoichiometry. Based on these results, we postulated that at low levels (similar to 20 wt%) the soft segment component derived from PHMO macrodiol was concentrated mainly in the interfacial regions, strengthening the adhesion between hard and soft domains of PDMS-based polyurethanes.