On 4 March 2011, Bywater joined Cardiff City on loan until the end of the season. He made his debut the following day in a 2–0 loss to Ipswich Town. Following Cardiff's playoff semi final defeat to Reading, in which a Bywater error cost Cardiff an important goal, Bywater returned to Derby. His future at "The Rams" was cast into serious doubt when he was not given a squad number ahead of the 2011–12 season and this was confirmed when Derby's goalkeeping coach Martin Taylor revealed "He's not in the squad at all. Nothing against Stephen because he's worked really hard but he doesn't figure in our plans. At his age he just needs to play games and get in the shop window." On 31 December 2011, Bywaters's contract was terminated by mutual consent.