An amorphous oxide containing hydrogen (or deuterium) is applied to a channel layer of a transistor. Accordingly, a thin film transistor having superior TFT properties can be realized, the superior TFT properties including a small hysteresis, normally OFF operation, a high ON/OFF ratio, a high saturated current, and the like. Furthermore, as a method for manufacturing a channel layer made of an amorphous oxide, film formation is performed in an atmosphere containing a hydrogen gas and an oxygen gas, so that the carrier concentration of the amorphous oxide can be controlled.