A semiconductor device includes a first die extending through a molding compound layer, a first dummy die having a bottom embedded in the molding compound layer, wherein a height of the first die is greater than a height of the first dummy die, and an interconnect structure over the molding compound layer, wherein a first metal feature of the interconnect structure is electrically connected to the first die and a second metal feature of the interconnect structure is over the first dummy die and extends over a sidewall of the first dummy die.