A method to form a passivation layer over a MR Sensor so that the passivation layer defines the track width. The passivation layer is formed simultaneously with the development of the lift off structure in a novel developing/oxidizing solution that oxidizes the MR sensor and develops the photoresist. The passivation layer is an electrical insulator that prevents sensor current from shunting through the overspray of the leads and a heat conductor to allow MR heat to dissipate through the overspray. The method comprises: spinning-on and printing a lift-off photoresist structure over the MR sensor. Next, the lift-off photoresist structure is developed. The MR sensor is anodized in a developing/oxidizing solution to: (1) remove portions of the lower photoresist and (2) to form a (e.g., thin NiFeO) passivation layer on the MR layer at least partially under the upper photoresist layer. The passivation layer is etched to remove the passivation layer not covered by the lift-off structure. Then, a lead layer is deposited over the passivation layer and MR sensor. The lift-off structure is removed.