With a direct nucleophilic addition between -OH groups of polydiol and -NCO of a silane, a blend of silyl-terminated polycaprolactone PCL-Si and silyl-terminated polydimethylsiloxane PDMS-Si oligomer, PCS-2Si, were firstly prepared, and then blended with a commercial epoxy resin (diglycidyl ether of bisphenol-A, DGEBA) to form a ternary composite. The formed ternary composites of different content of DGEBA were cured using a polyamido-amine as a curing agent and a sol-gel process at ambient temperature. The microstructures and properties of the cured composites were investigated by SEM, TGA, and energy dispersive spectroscopy. The results showed the compatibility between DGEBA and PDMS increased with increasing content of PCS-2Si, but higher content of PCS-2Si resulted in a slight enrichment of silicon in the surface of the cured film. TGA showed that incorporating PCS-2Si into epoxy resin altered the composites' thermal stability and degradation characteristics. (c) 2008 Wiley Periodicals, Inc.