A MR sensor is disclosed that has a free layer (FL) with perpendicular magnetic anisotropy (PMA) which eliminates the need for an adjacent hard bias structure to stabilize free layer magnetization and minimizes shield-FL interactions. In a TMR embodiment, a seed layer, free layer, junction layer, reference layer, and pinning layer are sequentially formed on a bottom shield. After patterning, a conformal insulation layer is formed along the sensor sidewall. Thereafter, a top shield is formed on the insulation layer and includes side shields that are separated from the FL by a narrow read gap. The sensor is scalable to widths