Broadly, the present invention is directed to an adhesive composition which comprises an epoxy resin, an effective amount of a mercapto curing agent or curative for said epoxy resin, and a compatibilizing amount of a polysulfide compound which has a performance improving fraction of its --SH groups rendered unreactive with the epoxy groups in said composition. Optionally, the adhesive composition can contain amine or amide curing agents in addition to the mercapto curative. Advantageously, at least about 5% of the number of reactive thiol groups of the polysulfide compound are rendered unreactive, advantageously at least about 25%, and preferably at least about 50%. Preferred polysulfide compatibilizing compounds are adducts of a polysulfide and a component which contains functionality reactive with a thiol group, but which contains no residual functionality reactive with epoxy groups in the composition once the polysulfide adduct is formed. Another aspect of the present invention is a method for improving the performance of an adhesive composition of an epoxy resin and a mercapto curative, which method comprises incorporating a compatibilizing amount of polysulfide compound which has had a performance improving fraction of its --SH groups rendered unreactive with epoxy groups in the composition. The polysulfide compatibilizing adduct is formed by the reaction of a polysulfide and a component that contains functionality reactive with thiol groups, but which contains no residual functionality reactive with epoxy groups in the adduct.