We investigated a polycrystalline sample of the ferrimagnetic compound Tb0.15Co0.85 by magnetometry and small-angle neutron scattering (SANS). The magnetization curve at 300 K is characteristic for soft ferrimagnets but at 5 K the hysteresis indicates the existence of magnetic domains. The magnetic SANS signal suggests that at 300 K the Tb and Co moments are correlated over large volumes within the micrometer-sized grains with correlation lengths >100 nm. At 5 K, however, the magnetic SANS analysis reveals a reduced correlation length of around 4.5 nm, which indicates the formation of narrow magnetic domains within the ferrimagnet with one dimension being in the nm range. We attribute the observed changes of the domain structure to the temperature-dependence of the magnetic properties of the Tb sublattice.