A method for forming a balloon for a dilatation catheter involving the steps of extruding a tubing preform of a polyester resin and then blowing the tubing into an oriented balloon, wherein the tubing preform is dried prior to blowing into the balloon form. The addition of this drying step to the balloon forming method has been observed to cause a reduction in the frequency of balloons which are rejected because of visible defects in the balloon wall, while producing the same or higher average wall strengths in the non-defective balloons obtained. Balloon cone and waist thicknesses are reduced by varying the axial tension and blowing pressure at several stages as a mold containing the balloon preform is dipped into a heating medium. Specifically, tubing of a thermoplastic material is placed in a mold and blown by pressurizing and tensioning the tubing and gradually dipping the mold into a heated heat transfer media so as to sequentially blow a first waist, a body and a second waist portion. The tubing is subjected to a relatively lower pressure while the body portion is blown than while the first and second waist portions are blown.