A high electron mobility transistor (HEMT) includes a first III-V compound layer and a second III-V compound layer disposed on the first III-V compound layer and is different from the first III-V compound layer in composition. A source feature and a drain feature are disposed on the second III-V compound layer. A p-type layer is disposed on a portion of the second III-V compound layer between the source feature and the drain feature. A gate electrode is disposed on the p-type layer. A capping layer is disposed on the second III-V compound layer.