The layered thin film structures of an element and an alloy has been widely used in fabricating microelectronic devices. The changes in magnetic properties and crystal structure of Ti/permalloy bilayer thin films induced by low dose nitrogen implantation were studied. The nitrogen doses used were at 5, 10, 20, 40, 80, and 160 X 10(14) ions/cM2. X-ray diffraction, optical magnetic domain imaging, and Auger electron spectroscopy were applied in this study. A preferential counter-current diffusion at the interface induced by the ion implantation was found. Increased nitrogen doses resulted in the changes of the lattice parameters, magnetic coercivity, and magnetic domain size. The amorphization of the bilayer films due to ion implantation was also discussed.