PB-g-PS graft copolymer with core/shell（PB/PS） ratio of 70/30, was prepared by grafting styrene onto polybutadiene(PB) latex with diameter of 300 nm through emulsion polymerization technique. By melt blending the graft copolymer with high impact polystyrene (HIPS), polyphenylene oxide(PPO) and polystyrene(PS), a series of HIPS/PPO/PS/ PB-g-PS blends were obtained, and the effects of PPO/PS ratios on the mechanical properties and morphology of the blends were investigated. It is found that there is a good synergism toughening behaviour between large rubber particles(2 μm～4 μm) in HIPS resin and PB-g-PS small rubber particle with a size of 300 nm by adding PB-g-PS graft polymer in HIPS/PPO/PS blends. The impact strength, tensile strength and strain at break of the blends are enhanced with increasing the amount of PPO in matrix; the impact strength of the blends appears a big margin improvement with the value from 300 J/m to 600 J/m when PPO/PS mass ratio is from 25/75 to 50/50. The morphology results show that the dispersion of PB-g-PS impact modifier in matrix is greatly improved with increasing the amount of PPO. Craze is the main deformation mechanism when the mass fraction of PPO is less than 10%, and shear yield is the main deformation mechanism when it is more than 20%.