Two "functionalized" concentrated emulsions in water were prepared separately, one from a weakly polymerized mixture of styrene (S) and a small amount of acrylic acid (AA) and the other from a mixture of butyl acrylate (or butyl methacrylate) and a small amount of glycidyl methacrylate (GMA). After the two concentrated emulsions were polymerized partially, they were mixed and subjected to complete polymerization. During the latter polymerization, reactions between the carboxyl groups of the AA moieties of the S/AA copolymer and the glycidyl groups of the GMA-containing copolymer occurred, and copolymers and crosslinked structures were generated that constituted the compatibilizers of the system. The blend materials thus obtained possessed excellent toughness compared to those without functional groups.