A high-electron mobility transistor (HEMT) device employing a gate protection layer is provided. A substrate has a channel layer arranged over the substrate and has a barrier layer arranged over the channel layer. The channel and barrier layers define a heterojunction, and a gate structure is arranged over a gate region of the barrier layer. The gate structure includes a gate arranged over a cap, where the cap is disposed on the barrier layer. The gate protection layer is arranged along sidewalls of the cap and arranged below the gate between opposing surfaces of the gate and the cap. Advantageously, the gate protection layer passivates the gate, reduces leakage current along sidewalls of the cap, and improves device reliability and threshold voltage uniformity. A method for manufacturing the HEMT device is also provided.