The relationship between the degree of ester-interchange reactions and the physical properties in the melt blending of poly(ethylene terephthalate) (PET) and polycaprolactone (PCL) was investigated in terms of the blending time. 1H-NMR and 13C-NMR spectra confirmed that poly(ethylene terephthalate caprolactone) copolyesters were generated and became dominant at a blending time of more than 15 min, and this result may be related to the degree of the thermal decomposition of PCL. The spectra disclosed the effect of the blending time on the block characteristics of the ethylene terephthalate (ET) and caprolactone (CL) units of the copolyesters. The melting temperatures and heats of fusion assigned to the ET units in the copolyesters decreased with the blending time. However, the melting peak of the CL units disappeared when the blending time exceeded 20 min. For the CL block, the number of the average repeating units (5) proved to be the least critical value for crystallization. The crystallinity of the copolyesters was most notably reduced with a blending time up to 20 min. The total organic carbon (TOC) content of the copolyesters, a quantitative measure of biodegradability, increased steeply with the blending time up to 20 min. However, the TOC content increased slowly during extended blending. This agrees well with the recognized fact that the accession and penetration of lipase into copolyesters initiate in the amorphous region of the polymer.