A method for forming an abutted junction GMR bottom spin valve sensor in which the free layer has a maximum effective length due to the elimination or minimization of bias layer and conducting lead layer overspreading onto the sensor element and the consequent reduction of current shunting. The overspreading is eliminated by forming a thin dielectric layer on the upper surface of the sensor element. When the biasing and conducting leads are formed on the abutted junction, they overspread onto this layer and the overspread can be removed by an ion-milling process during which the dielectric layer protects the sensor.