We describe a novel compatibilization strategy by employing novel compatibilizers, in particular short unentangled poly(styrene) (PS) polymers, in phase separating poly[(methyl styrene)-co-acrylonitrile]/poly(methyl methacrylate) (PMSAN/PMMA) blends or immiscible PS/PMMA blends. The compatibilization effectiveness of the PS polymers is assessed by in-situ characterization of the matrix-droplet morphology as a function of coalescence time using a flow-induced coalescence protocol. Below the entanglement molecular weight (Me), there is good compatibilization, discerned from the decrease in the interfacial tension and increase in the extent of coalescence suppression of the PMMA droplets in 85/15 PMSAN/PMMA and PS/PMMA blends. However, compatibilization significantly decreases if the molecular weight (Mw) of the PS polymers is increased above Me. The critical Mw for maximum compatibilizing effects is in-line with the predictions of energetically favorable interactions of PS polymers with the PMSAN or PS matrix phase, determined from the interaction parameter as well as the Gibbs free energy change upon mixing. The compatibilization effects are independent of the functionalization of the PS terminal groups and also hold when the compatibilizer has exactly the same chemical composition as one of the blend components, thus demonstrating self-compatibilization behavior.