The thermal properties of biaxially blown poly(etherimide) (PEI) films containing a thermotropic liquid crystalline polymer (TLCP) were studied using differential scanning calorimetry, thermogravimetric analysis, wide-angle X-ray diffraction and dynamic mechanical thermal analysis. The effects of the compatibilizer and thermal annealing on the thermal properties of biaxially oriented TLCP films were investigated. Though the compatibilizer (poly(ester imide)) improved deformation of the TLCP phase (poly ester amide) and adhesion between the matrix and the TLCP phase. which improved mechanical properties, it did not significantly affect the thermal properties of the in situ composite films. The film degradation behavior corroborated the role of the compatibilizer. Since a relatively small amount of TLCP (10 wt%) was added to the matrix and the matrix PEI was amorphous, the effect of annealing on the TLCP structure was not obvious. By the same token, while the effect of the deformation in the circumferential direction (a change in the blow-up ratio) was manifest in mechanical property improvements, its effect on the thermal properties was not obvious. All films showed similar thermal expansion behaviors, regardless of the thermal history and of the compatibilizer addition. Thus, there is an optimum amount of the compatibilizer required to obtain optimal mechanical properties for in situ composite films without causing a deterioration of their thermal properties. (C) 2004 Society of Plastics Engineers.