Epoxy resin networks modified with different functionalized liquid polybutadiene were characterized by scanning electron microscopy, atomic force microscopy (AFM), and dielectric thermal analysis techniques' Different morphologies were observed for these different systems, which were attributed to different interaction degrees between the components. Hydroxyl-terminated polybutadiene (HTPB) and carboxyl-terminated polybutadiene (CTPB) resulted in epoxy networks with two-phase morphology that differed in rubber particle size. The use of isocyanate-terminated polybutadiene (NCOTPB) resulted in transparent thermoset material, whose rubber domains were in the nanoscale dimension, only detected by the AFM technique. The different morphological aspects in these epoxy systems also affected the dielectric properties. The epoxy-HTPB network exhibited two low temperature relaxation peaks corresponding to two different phases present in the system, whereas the epoxy-CTPB or epoxy-NCOTPB systems, whose rubber particles are well adhered to the epoxy matrix by chemical bonds, displayed only one single low temperature relaxation peak. (C) 2004 Wiley Periodicals, Inc.