A semiconductor device with reduced defect density is fabricated by forming localized metal silicides instead of full area silicidation. Embodiments include forming a transistor having a gate electrode and source/drain regions on a substrate, forming a masking layer with openings exposing portions of both the gate electrode and source/drain regions over the substrate, depositing metal in the openings on the exposed portions, forming silicides in the openings, and removing unreacted metal and the masking layer.