Disclosed is a device isolating method of a semiconductor device, comprising the steps of sequentially forming a pad oxide film, a polysilicon film and an insulating layer, on a silicon substrate, said insulating layer being composed of a first silicon oxide film, a nitride film and a second silicon oxide film formed sequentially on the polysilicon film; defining active and inactive regions by using a patterned photomask; removing the insulating layer only on the inactive region so as to expose a surface of the polysilicon film; forming a side wall at both edges of the insulating layer on the active region, said side wall being composed of a nitride film; depositing a third silicon oxide film on the surface of the polysilicon film; removing the side wall and etching the substrate to a predetermined depth to form a trench; filling an insulating material into the trench and depositing it up to the second silicon oxide so as to form an insulating film for isolating; simultaneously removing the second silicon oxide film and the silicon oxide film and removing the polysilicon film only the inactive region; performing a thermal oxidation to form a field oxide film on the inactive region; and sequentially removing the isolating layer and the polysilicon film formed on the active region. Because the active region is defined using an insulator-filled shallow trench before performing thermal oxidation, no oxygen is penetrated into the active region during the thermal oxidation, whereby a field oxide film can be formed without occurrence of a Bird's beak.