Reaction-induced phase separation occurring by spinodal decomposition is simulated in this paper. A technique developed earlier [Alfarraj A, Nauman EB. Spinodal decomposition in ternary systems with significantly different component diffusivities. Macromolecular Theory and Simulations, 2007;16:627-31.] that allows component diffusivities to be dramatically different has been extended to reactive conditions. The example system is the formation of impact polystyrene. The final morphology is a continuous polystyrene phase and a discrete rubber phase where the rubber particles contain polystyrene occlusions. The morphology is modeled for an agitated batch reactor. Simulations of a quiescent batch polymerization also give a discrete rubber phase. This is contrary to reports in the early patent literature, the difference being attributed to cross-linking of the rubber that is not considered in the current model. (C) 2007 Elsevier Ltd. All rights reserved.