An object is to provide an SOI substrate with excellent characteristics even in the case where a single crystal semiconductor substrate having crystal defects is used. Another object is to provide a semiconductor device using such an SOI substrate. A single crystal semiconductor layer is formed by an epitaxial growth method over a surface of a single crystal semiconductor substrate. The single crystal semiconductor layer is subjected to first thermal oxidation treatment to form a first oxide film. A surface of the first oxide film is irradiated with ions, whereby the ions are introduced to the single crystal semiconductor layer. The single crystal semiconductor layer and a base substrate are bonded with the first oxide film interposed therebetween. The single crystal semiconductor layer is divided at a region where the ions are introduced by performing thermal treatment, so that the single crystal semiconductor layer is partly left over the base substrate. The single crystal semiconductor layer left over the base substrate is irradiated with laser light. The single crystal semiconductor layer left over the base substrate is subjected to second thermal oxidation treatment to form a second oxide film. Then, the second oxide film is removed.