A semiconductor device and a manufacturing method thereof are provided. The semiconductor device includes a gate, a channel layer, a gate insulation layer, a source, a drain and a silicon-aluminum-oxide layer. The gate is disposed on a substrate. The channel layer is disposed on the substrate. The channel layer overlaps the gate. The gate insulation layer is disposed between the gate and the channel layer. The source and the drain are disposed on two sides of the channel layer. The silicon-aluminum-oxide layer is disposed on the substrate and covers the source, the drain and the channel layer.