To establish a processing technique in manufacture of a semiconductor device including an In—Sn—Zn—O-based semiconductor. An In—Sn—Zn—O-based semiconductor layer is selectively etched by dry etching with the use of a gas containing chlorine such as Cl2, BCl3, SiCl4, or the like. In formation of a source electrode layer and a drain electrode layer, a conductive layer on and in contact with the In—Sn—Zn—O-based semiconductor layer can be selectively etched with little removal of the In—Sn—Zn—O-based semiconductor layer with the use of a gas containing oxygen or fluorine in addition to a gas containing chlorine.