Production of high performance conductive textile yarn fibers for different electronic applications has become a prominent area of many research groups throughout the world. We have used oxidative chemical vapor deposition (OCVD) technique to coat flexible and high strength polyester yarns with conjugated polymer, poly(3,4- ethylenedioxythiophene) (PEDOT) in presence of ferric (III) chloride (FeCl3) oxidant. OCVD is an efficient solvent free technique used to get uniform, thin, and highly conductive polymer layers on different substrates. In this paper, PEDOT-coated polyester (PET) yarns were prepared under specific reaction conditions, and the electrical, mechanical and thermal properties were compared to previously studied PEDOT-coated viscose yarns. Scanning electron microscopy (SEM) and FT-IR analysis revealed that polymerization of PEDOT on the surface of the polyester yarns has been taken place successfully and structural analysis showed that PEDOT has strong interactions with viscose yarns as compared to PET yarns. The voltage–current (V–I) characteristics showed that PET yarns are more conductive than PEDOT-coated viscose yarns. The variation in the conductivity of PEDOT-coated yarns and the heat generation properties during the flow of current through coated yarns for longer period of time, was studied by time–current (t–I) characteristics. Thermogravimeteric analysis (TGA) was employed to investigate the thermal properties and the amount of PEDOT in PEDOT-coated PET yarns compared to PEDOT-coated viscose. The effect of PEDOT coating and ferric (III) chloride concentration on the mechanical properties of coated yarns was evaluated by tensile testing. The obtained PEDOT-coated conductive polyester yarns could be used in smart clothing for medical and military applications.