In this work, a novel epoxy monomer denoted as 3,5′-di-t-butyl-5,3′-dimethyl biphenyl diglycidyl ether (t-BuMBPDGE) was synthesized and applied into in situ composites with 3,3′,5,5′-tetramethyl-4,4′-biphenyl diglycidyl ether (TMBPDGE), accompanied with curing agent aromatic amines. The liquid crystalline phase structure and the crosslink density of substituted biphenyl epoxies were determined by polarized optical microscopy, wide angle X-ray diffraction measurements and dynamic storage moduli data. The samples showed good mechanical properties and could recover quickly from a second state to their initial states with a shape fixity ratio higher than 98% and shape recovery ratio higher than 99%, owing to the oriented structure and increased crosslink network density caused by the orientation of biphenyl mesogenic. The high glass transition temperatures ranging from 160 to 178 °C and good water resistance could contribute to a stable fixed shape. The water resistance is analyzed by contact angles test. The samples exhibited contact angles of 92–98 degrees, which indicated that the water resistance was apparently better than that of conventional epoxy systems.