Three urethane methacrylates, one monofunctional derivative and two di-functional derivatives with different chain lengths were used as reactive diluents in UV-curable polyester powder coatings. Each reactive diluent was formulated with a methacrylated polyester oligomer using conventional melt extrusion techniques. The effect of these compounds on zero-shear melt viscosity was investigated. Incorporation of 10 wt% reactive diluent effectively reduced the viscosity by an order of magnitude. After UV-curing, the viscoelastic, thermal, and mechanical properties of the films were characterized using dynamic mechanical analysis, differential scanning calorimetry, thermogravimetric analysis, and tensile tests. The type and concentration of reactive diluent that was used directly influenced the glass transition temperature, modulus, % elongation-at-break, and crosslink density. Of the two di-functional reactive diluents that were used, the derivative that contained a shorter methylene spacer group resulted in more heterogeneous crosslinked networks.