The effect of lateral magnetic domains on exchange-bias phenomena in a soft/hard Gd 40 Fe 60 ͑100 nm͒ / Tb 12 Fe 88 ͑50 nm͒ bilayer with antiferromagnetic interface exchange coupling is investigated. At low temperature , domains in the hard TbFe layer are found to behave independently of each other and to give rise to their own exchange-bias fields. Double hysteresis loops are observed when the sample is cooled with domains present in both the hard TbFe layer and the soft GdFe layer, whereas single hysteresis loops are observed when domains are only present in the hard layer. These features are understood by taking into account the presence of both lateral domains and planar interface domain walls in this strongly coupled system.