ZnxCd1-xSe/C core/shell nanocrystals with 31-39 nm diameter semiconductor cores and 11-25 nm-thick carbon shells were synthesized from solid state precursors. Transmission electron microscopy showed striations on a scale of ∼1-5 nm in the nanocrystals that are indicative of a composition modulation, and reveal a chemical phase separation and possible spinodal decomposition within the nanocrystals. Such a composition modulation within the ternary nanocrystals represents a rarely reported phenomenon that could lead to additional applications. The optical properties and carrier relaxation kinetics of the nanocrystals were examined with variable excitation cathodoluminescence (CL). As the excitation level is increased, carrier filling in two-dimensional (2D) phase-separated Cd-rich regions leads to a partial saturation of states before the onset of carrier filling in the higher bandgap homogenous Zn0.47Cd0.53Se regions. In order to model the state filling using Fermi-Dirac statistics for non-interacting carriers, a random quantum well model was used to determine the electron and hole eigensates in the Cd-rich regions of the nanocrystals.