We have imaged the stripe domain structure of perpendicularly magnetized fcc ultrathin Fe films grown on Cu(100). The stripe phase has a strong local orientational order and sustains the two kinds of fluctuations predicted by Abanov et al. [Phys. Rev. B 51, 1023 (1995)]: meandering and dislocations. Before reaching the Curie temperature, the stripes transform into a new and so far unobserved domain structure, characterized by domains with predominantly square corners. We argue that this phase is the tetragonal liquid phase proposed by Abanov et al. to separate the stripe phase from the paramagnetic phase. This two-step disordering is reminiscent of a two-dimensional melting process.