The dispersion state of multiwall carbon nanotubes (MWNTs) in melt mixed polyethylene/polyethylene oxide (PE/PEO) blends has been assessed by both surface and volume electrical conductivity measurements and the structural relaxations have been assessed by broadband dielectric spectroscopy. The selective localization of MWNTs in the blends was controlled by the flow characteristics of the components, which led to their localization in the energetically less favored phase (PE). The electrical conductivity and positive temperature co-efficient (PTC) measurements were carried out on hot pressed samples. The neat blends exhibited only a negative temperature coefficient (NTC) effect while the blends with MWNTs exhibited both a PTC and a NTC at the melting temperatures of PE and PEO respectively. These phenomenal changes were corroborated with the different crystalline morphology in the blends. It was deduced that during compression molding, the more viscous PEO phase spreads less in contrast to the less viscous PE phase. This has further resulted in a gradient in morphology as well as the distribution state of the MWNTs in the samples and was supported by scanning electron and scanning acoustic microscopy (SAM) studies and contact angle measurements. SAM from different depths of the samples revealed a gradient in the microstructure in the PE/PEO blends which is contingent upon the flow characteristics of the components. Interestingly, the surface and volume electrical conductivity was different due to the different dispersion state of the MWNTs at the surface and bulk. The observed surface and volume electrical conductivity measurements were corroborated with the evolved morphology during processing. The structural relaxations in both PE and PEO were discerned from broadband dielectric spectroscopy. The segmental dynamics below and above the melting temperature of PEO were significantly different in the presence of MWNTs. © 2014 The Royal Society of Chemistry.