A method of fabricating a horizontal isolation structure between a deep trench capacitor and a vertical transistor thereon is provided. A deep trench capacitor is in the bottom of a deep trench of a substrate. An insulating layer is formed to partially fill the deep trench and also on the substrate by high-density plasma chemical vapor deposition. The insulating layer on the sidewall of the deep trench and on the substrate is removed to transform the insulating layer in the deep trench to an isolation structure. An alternative approach is to form an insulating layer on the substrate and in the deep trench. Then a CMP is performed to remove the insulating layer on the substrate and an etching back is performed to remove the upper portion of the insulating layer in the deep trench. Then the remained insulating layer in the deep trench is served as an isolation structure between the deep trench capacitor and a vertical transistor thereron. The upper portion of the insulating layer in the alternative approach is also can be replaced by a low-cost sacrificial layer.