Attempts were made to study the effect of reactive compatibilization via Friedel-Crafts alkylation reaction, using AlCl3 as a catalyst, on rheology, morphology, and mechanical properties of polyethylene/polystyrene (PE/PS) blends. The results of linear viscoelastic measurements in conjunction with the results of the mixing torque variation indicated that PS showed much more degradation than that of PE in the presence of AlCl3. It was also found that while for PE-rich blends, the viscosity, and storage modulus increased by reactive compatibilization, they decreased for PS-rich blends. The variation of viscosity and storage modulus for 50/50 blend was found to be dependent on frequency ranges showing the competitive effects of PE-g-PS copolymer formation and PS degradation. The results of morphological studies showed that reactive compatibilization decreased the particle size and particle-size distribution broadness because of in situ graft copolymer formation. Reactive compatibilization enhanced the tensile strength and elongation at break for PE-rich blends. It was demonstrated that there is a close interrelationship between rheology, morphology, and mechanical properties of reactive compatiblized PE/PS blends. It was also demonstrated that rheological behaviors have a reliable sensitivity to follow the structural and morphological changes during compatibilization process, so that, those information can be used to predict the morphology as well as mechanical properties of the blends.