A magnetoresistive sensor having a pinned layer that includes a first magnetic layer (AP1) a second magnetic layer (AP2) and an antiparallel coupling layer sandwiched between the AP1 and AP2 layers. The AP1 layer is adjacent to a layer of antiferromagnetic material (AFM layer) and is constructed so as to have a long spin diffusion length. The long spin diffusion length of the AP1 layer minimizes the negative GMR contribution of the AP1 layer, thereby increasing the overall GMR effect of the sensor.