Abstract Europium intermetallic compounds show a variety of different ground states and anomalous physical properties due to the interactions between the localized 4f electrons and the delocalized electronic states. Europium is also the most reactive of the rare earth metals which might be the reason why very few works are concerned with the properties of Eu-based thin films. Here we address the low-temperature magnetic properties of ferromagnetic EuPd₂ thin films prepared by molecular beam epitaxy. The epitaxial (111)-oriented thin films grow on MgO (100) with eight different domain orientations. We analyze the low-temperature magnetic hysteresis behavior by means of micromagnetic simulations taking the multi-domain morphology explicitly into account and quantify the magnetic crystal anisotropy contribution. By ab initio calculations we trace back the microscopic origin of the magnetic anisotropy to thin film-induced uniform biaxial strain.