Understanding the relationships between the processing factors in laser powder bed fusion (L-PBF) and residual stress formation is critical for improving the final part performance since tensile residual stress has a critical impact on fatigue life performance and final material properties of the manufactured part. Laser powder bed fusion has virtually infinite number of processing factors each can impact the residual stress, among which, layer thickness is one of them. This paper investigates the impact of powder layer thickness on residual stress formation for the Ni-based super-alloy Inconel 718 (IN718). Test coupons with different layer thicknesses are fabricated with the same geometry. Residual stress is determined via X-ray diffraction (XRD) at different locations along the build direction and transverse direction. In addition, the previously developed physics-based analytical model is used to draw a relationship between powder layer thickness and residual stress through the prediction of temperature field and thermal stress using incremental plasticity. The results of computational modeling and experiments are in good agreement and shows that the increase in powder layer thickness increases the residual stress in an additively manufactured part.