The effect of nanoclay on phase morphology development of polyamide/styrene-acrylonitrile (PA/SAN) blends has been investigated. PA/SAN blends of various compositions, with and without the presence of exfoliated nanoclay in the PA phase, were prepared and the morphology of these blends was examined. Efforts have also included the study of morphology stability of these blends and the nanoclay effect on morphology stability of PA/SAN. The results suggest that at compositions where PA remains as the matrix domain, the nanoclay can be effective on reducing dispersed domain size to less than half the original size and furthermore improving the morphology stability of PA/SAN blends upon annealing by preventing coalescence of SAN domain. Implication of the present finding for effective preparation of stable incompatible blends is discussed. (C) 2010 Elsevier Ltd. All rights reserved.