An array substrate and manufacturing method thereof and display device are provided. The method of manufacturing the array substrate includes forming a pattern including a gate electrode, a gate line, a common electrode line and a gate insulating layer on a substrate; forming a pattern including a data line, a source electrode, a drain electrode and an active layer; forming a pattern including an insulating interlayer over the pattern of the source electrode, the drain electrode and the active layer; forming a pattern including a first transparent electrode over the insulating interlayer; forming a pattern including a passivation layer over the first transparent electrode; and forming a pattern including a second transparent electrode over the passivation layer. The method can efficiently prevent the ITO process polluting the TFT channel.