The antiferromagnctic FeMn thin film has been used to stabilize the domains in NiFe films by exchange-coupling, thus eliminating the Barkhauscn noise in magnetoresistive sensor designs. T'he strength of this exchange-coupling is highly dependent on the interfacial structure, as well as the interfacial composition of this NiFe/FeMn thin film couple. We have conducted isothermal, as well as isochronal anneals of NiFe/FeMn thin film couples, and monitored their magnetic properties, in particular the strength of their exchange-coupling. The strength of exchange-coupling, measured by the shift of the B-H loop obtained from a hysteresis loop tracer, increased monotonically with annealing time for isothermal anneals between 200 and 300 °C. At higher temperatures (up to 500°C), the interdiffusion between the two layers is so extensive that the NiFe layer loses its sort-magnetic properties and the coupling strength is degraded. Composition depth-profiling by scanning Auger analysis was conducted to study the interdiffusion profiles of the annealed samples. Cross-section transmission electron microscopy (XTEM) was used to study the microstructure, crystallography, and composition of these thin films after annealing. Micro-beam composition analysis was also carried out and the compositional profile obtained was compared to the Auger depth-profile results. Transmitted electron diffraction using selected area electron diffraction (SAED) and elongated probe micro-diffraction (EPMD) of XTEM samples was used to study the crystallography of these films.