A novel phase-separating liquid rubber based on oligo(alkylmethacrylate) in combination with microglass beads was used to toughen an anhydride-cured epoxy resin. The resulting hybrid composites, containing 5 or 10 wt % of oligomeric liquid rubber and between 10 and 60 wt % glass beads as well as composites containing corresponding amounts of glass beads but no liquid rubber, were characterized mechanically. The experimental data show that modification with glass beads results in increased stiffness and toughness compared to the neat resin but reduces tensile strength. Compared to the glass bead-filled composites, additional modification with methacrylic rubber leads to a further increase in toughness and also to an increase in strength but does not alter stiffness and glass-transition temperature. This synergistic behavior is explained by the fact that the rubber separates preferably on the surface of the glass bead, forming a core-shell morphology during curing. (C) 2003 Wiley Periodicals, Inc.