This paper presents a detailed microscopic observation of magnetic domains in Gd-Fe thin films using magnetic force microscopy and Kerr microscopy with longitudinal sensitivity. Two different sets of Gd-Fe films of various thicknesses were prepared where set-B is richer in Fe compared to set-A. A thickness-dependent transition from in-plane magnetization state to weak out-of-plane state with nano-scale stripe domains has been observed for the films of set-A where the critical thickness of transition was estimated to be around 50 nm. The film with thickness below the critical limit exhibits band domains along the in-plane easy axis and successively transform to the ripple-like states when the external field is applied along the hard axis. The films of set-B exhibit predominant in-plane magnetization irrespective of thicknesses. The ripple domain state to wider band domains has been observed with the increase in film thickness. The domain pattern and their angular variation confirm that the magnetization reversal is dominated by nucleation and propagation of domain walls. Micromagnetic simulation successfully complements the phenomenon of stripe domain formation at higher thicknesses. © 2019 Elsevier B.V.