A fuse element utilizing a reaction between two layers by feeding current is manufactured. A fuse element including a first layer formed of an oxide or a nitride and a second layer that becomes high resistant by nitridation or oxidation, in which the first layer and the second layer are in contact with each other, is manufactured. For example, the fuse element is manufactured by using indium tin oxide for the first layer and aluminum for the second layer. By generating joule heat by applying voltage to the first layer and the second layer, oxygen in the indium tin oxide enters the aluminum, which changes the aluminum into aluminum oxide that presents an insulating property. The fuse element can be manufactured by a similar process as that of forming a TFT.