The structure of a semiconductor device with inner spacer structures between source/drain (S/D) regions and gate-all-around structures and a method of fabricating the semiconductor device are disclosed. The semiconductor device includes a substrate, a stack of nanostructured layers with first and second nanostructured regions disposed on the substrate and first and second source/drain (S/D) regions disposed on the substrate. Each of the first and second S/D regions includes an epitaxial region wrapped around each of the first nanostructured regions. The semiconductor device further includes a gate-all-around (GAA) structure disposed between the first and second S/D regions and wrapped around each of the second nanostructured regions, a first inner spacer disposed between an epitaxial sub-region of the first S/D region and a gate sub-region of the GAA structure, a second inner spacer disposed between an epitaxial sub-region of the second S/D region and the gate sub-region of the GAA structure, and a passivation layer disposed on sidewalls of the first and second nanostructured regions.