The influence of interfacial intermixing on the picosecond magnetization dynamics of ferromagnetic/non-magnetic thin-film bilayers was studied. Low-dose focused-ion-beam irradiation was used to induce intermixing across the interface between a 10 nm Ni81Fe19 layer and a 2–3 nm capping layer of either Au or Cr. Time-resolved magneto-optical Kerr effect was used to study magnetization dynamics as a function of ion-beam dose. With an Au cap, the damping of the un-irradiated bilayer was comparable with native Ni81Fe19 and increased with increasing ion dose. In contrast, for Ni81Fe19/Cr the damping was higher than that for native Ni81Fe19, but the damping decreased with increasing dose.