A gate electrode is provided via a gate insulating film formed between the source
and drain regions on a semiconductor substrate, wherein the sidewall of the gate
electrode excluding the exposed part formed at the upper part thereof facing the
source and drain regions is covered with a sidewall insulating film, and an epitaxial
film is formed on the exposed part of the sidewall of the gate electrode but not
formed on a top surface of the gate electrode. An element isolation region formed
on the semiconductor substrate is composed of a first insulating film formed in
the semiconductor substrate and a second insulating film which is formed inside
the first insulating film and has a lower epitaxial growth rate than that of the
first insulating film, and the surface of the source and drain regions is covered
with a silicon layer, part of which runs onto the surface of the first insulating film.
