Homogeneous grafting of 2-hydroxyethyl methacrylate onto cellulose was carried out in a dimethyl sulfoxide/paraformaldehyde solvent system. The grafted products were added to cellulose/poly(2-hydroxyethyl methacrylate) (PHEMA) blends as compatibilizers. The thermal decomposition behavior of the blends was investigated by thermogravimetry. The thermal stability of the blends decreased with an increase in grafted product content. Peak intensity of wide-angle X-ray diffraction patterns decreased with grafted product content. The microphase-separated structures of the blends became finer with grafted product content. Dynamic mechanical measurements were carried out to determine glass transition temperatures, Tg, of the blends. Tg for cellulose decreased with grafted product content but that for PHEMA increased. Differences in thermal decomposition behavior of the blends were correlated to compatibility. Thermogravimetry was effective for compatibility estimation in cellulose/PHEMA blends containing grafted products.