We investigate the Kelvin-Helmholtz instability at the Venus ionopause resulting from the flow of the (shocked) solar wind tangential to the ionopause for the case where the interplanetary field is oriented normal to the direction of flow. It is found that gravity stabilizes the long wavelength perturbations, and the finite thickness of the boundary layer stabilizes short wavelength modes. The magnetic 'gyroviscosity' due to finite Larmor radius effects either destabilizes the boundary or stabilizes it according to whether the solar wind electric field points away from or toward the ionosphere. For solar wind and ionosphere plasma parameters consistent with Pioneer Venus observations we find that the instabilities with the greatest growth rates (shortest growth times) have wavelengths of ~50--150 km and growth times of ~0.5 to several seconds. In addition, we show how distortion of the ionopause by Kelvin-Helmholtz instability might lead to the formation of magnetic 'flux ropes' inside the ionosphere as well as ionospheric 'bubbles' embedded in the solar wind.