A method of manufacturing a stator of an electric rotating machine is provided. The stator includes a plurality of teeth radially extended from a yoke portion formed by stacking steel sheets, a stator core having an insulating film on a surface of the teeth, and a winding portion including a plurality of layers of a power generating coil wound around each of the plurality of teeth. The method includes: a step of forming an insulating coating film by impregnating the power generating coil in a lower layer portion of the winding portion with a varnish using a liquid-type thermosetting resin, thereafter covering the power generating coil in a surface portion of the winding portion with a thermally meltable powder resin, and melt-bonding and thereafter curing the powder resin; and a step of curing the varnish that is performed simultaneously with the step of forming an insulating coating film.