A semiconductor device, such as a PMOS or an NMOS transistor, having a stressed channel region is provided. The semiconductor device is formed by recessing the source/drain regions after forming a gate stack. The substrate is removed under the gate stack. Thereafter, an epitaxial layer is formed under the gate stack and in the source/drain regions. The epitaxial layer may be doped in the source/drain regions. In an embodiment, a lower portion of the epitaxial layer and the epitaxial layer under the gate stack may be doped with a conductivity type opposite of the conductivity type of the source/drain regions. In another embodiment of the present invention, a lower portion of the epitaxial layer is left undoped.