Polymer electrolytes, (PEO:LiClO4) l x IL (1-Buty-3-methylimidazolium hexafluorophosphate) with varying concentration of IL; x = 0,5,10,15,20 wt % have been prepared by solution cast technique and characterized by X-Ray diffraction, differential scanning calorimetery, FTIR, conductivity and dielectric relaxation measurements in the frequency range of 100 Hz-5 MHz. Temperature dependence of relaxation frequency and conductivity were found to be typical of thermally activated process both at T > T-m and T < T-m. Composition dependence of conductivity, dielectric relaxation, and degree of crystallinity has also been studied. On addition of IL, the degree of crystallinity after a decrease at 5 wt % IL increases slightly at 10 wt % and then finally decreasing. Variation of conductivity and relaxation frequency with composition could only be partly explained on the basis of variation of degree of crystallinity. An additional feature of ion-ion interaction (contact ion pair formation between IL or salt cations and their associated anions) has been invoked which was supported by FTIR studies. (C) 2010 Wiley Periodicals, Inc. J Polym Sci Part B: Polym Phys 49: 291-300, 2011