Polylactic acid (PLA)/styrene-ethylene-butylene-styrene (SEBS) composites were prepared by melt blending. Differential scanning calorimetry (DSC) and wide angle X-ray diffraction (WXRD) were used to characterize PLA and PLA/SEBS composites in terms of their melting behavior and crystallization. Curves from thermal gravimetric analysis (TGA) illustrated that thermostability increased with SEBS content. Further morphological analysis of PLA/SEBS composites revealed that SEBS molecules were not miscible with PLA molecules in PLA/SEBS composites. The tensile testing for PLA and PLA/SEBS composites showed that the elongation at the break was enhanced, but tensile strength decreased with increasing SEBS content. L929 fibroblast cells were chosen to assess the cytocompatibility; the cell growth of PLA was found to decrease with increasing SEBS content. This study proposes possible reasons for these properties of PLA/SEBS composites.