A semiconductor device includes a silicon substrate, a strain-inducing layer, a silicon layer, a FET, and an isolation region. On the silicon substrate, the strain-inducing layer is provided. On the strain-inducing layer, the silicon layer is provided. The strain-inducing layer induces lattice strain in a channel region of the FET in the silicon layer. The silicon layer includes the FET. The FET includes a source/drain region, an SD extension region, a gate electrode and a sidewall. The source/drain region and the strain-inducing layer are spaced from each other. Around the FET, the isolation region is provided. The isolation region penetrates the silicon layer so as to reach the strain-inducing layer.