A large coercivity and anisotropy enhancement in perpendicular NdDyFeB (120 nm)/Dy (tDy) films has been realized by a Dy grain-boundary diffusion process. The coercivity HC and the ratio Mr/Ms reach their maxima at tDy = 50 nm, and the magnetic domain sizes increase with increasing tDy. The HC and Mr/Ms increasing with tDy is due to the enhancement of the anisotropy of (Nd,Dy)2Fe14B grains by Dy substitution for Nd. The coercivity mechanism is a nucleation-type mechanism. Dy and Nd elements coexist at grain boundaries, forming a (Nd,Dy)-rich phase, which may promote the nucleation of reversal domains.