Transmission of information using the spin of the electron as well as its charge requires a high degree of spin polarization at surfaces. At surfaces however this degree of polarization can be quenched by competing interactions. Using a combination of surface sensitive x-ray and tunneling probes, we show for the quasi-two-dimensional bilayer manganites that the outermost Mn-O bilayer, alone, is affected: it is a 1-nm thick insulator that exhibits no long-range ferromagnetic order while the next bilayer displays the full spin polarization of the bulk. Such an abrupt localization of the surface effects is due to the two-dimensional nature of the layered manganite while the loss of ferromagnetism is attributed to weakened double exchange in the reconstructed surface bilayer and a resultant antiferromagnetic phase. The creation of a well-defined surface insulator demonstrates the ability to naturally self-assemble two of the most demanding components of an ideal magnetic tunnel junction.