Copolyesters based on poly(butylene terephthalate) (PBT) and a bio-based fatty acid dimer diol (FADD) were prepared by solid-state modification (SSM). The chemical incorporation of the FADD into the backbone of the PBT was proven using various techniques. It was clear that the incorporation rate was diffusion-limited rather than reaction-limited. From quantitative 13C NMR a nonrandom chemical microstructure was obtained at all compositions. Moreover, differential scanning calorimetry (DSC) and small-angle X-ray scattering (SAXS) revealed a morphology of stacks of lamellar PBT crystals with amorphous regions that display microphase separation between the PBT-rich chain segments and the FADD-rich chain segments. This microphase separation is ...