When a short fiber of a thermotropic liquid-crystalline polymer retracts in a quiescent, flexible polymer matrix, the polydomain texture inside the fiber evolves simultaneously. We have demonstrated experimentally that the two processes are coupled. The dynamic interfacial tension, determined from the retraction of the short fiber, decreases with time. On the other hand, we have determined the aspect ratio of the polydomains inside the fiber through the power spectra of two-dimensional discrete Fourier transformations of polarized optical microscopy images. The polydomains are initially elongated and aligned with the fiber axis. As the fiber retracts into a spherical drop, the polydomains first retract into a circular shape and then are squeezed into elongated shapes perpendicular to the original fiber axis. An exponential function correlates the evolution of the dynamic interfacial tension with that of the aspect ratio of the textures. (c) 2006 Wiley Periodicals, Inc.