A memory device with a dielectric layer or an air gap between contacts and a method of making the same are disclosed. The method comprises a series of steps including forming a plurality of conductive lines having trenches therebetween; forming a contact layer in the trench; and forming a dielectric layer interposed in the contact layer and configured to divide the contact layer into two contacts. The method also comprises removing the dielectric layer to form a space and forming a cap layer over the two contacts to form an air gap therein. The method further comprises forming a second air gap between the conductive line and the two contacts.