A magnetoresistive sensor having an in stack bias structure that extends beyond a stripe height edge defined by the free and pinned layers. The bias structure includes a magnetic bias layer that is magnetostatically coupled with the free layer by a non-magnetic spacer layer. The bias layer is pinned by an AFM layer that is disposed outside of the active area of the sensor beyond the stripe height edge. The AFM layer is exchange coupled with the bias layer on the same side of the bias layer that contacts the spacer layer. This reduces the gap height by moving the AFM layer up within the level of the other sensor layers.