A magnetoresistive structure having two dielectric layers, and method of manufacturing same, includes a free magnetic layer positioned between the two dielectric layers. The method of manufacture comprises at least two etch processes and at least one encapsulation process interposed therebetween wherein the encapsulation is formed on sidewalls of the partially formed magnetoresistive stack between etch processes. For example, an exemplary method of manufacturing a magnetoresistive device includes etching through a second electrode, second dielectric layer and free magnetic layer to provide a sidewall of (i) an unpinned synthetic antiferromagnetic structure, (ii) a second dielectric layer and (iii) a free magnetic layer; thereafter, forming an encapsulation material on the sidewall of the unpinned synthetic antiferromagnetic structure, second dielectric layer and free magnetic layer, and after forming the encapsulation material, etching through a first dielectric layer.