In a method of manufacturing a semiconductor device, a dummy gate structure is formed over a substrate. A first insulating layer is formed over the dummy gate structure. The dummy gate structure is removed so as to form a gate space in the first insulating layer. A first conductive layer is formed in the gate space so as to form a reduced gate space. The reduced gate space is filled with a second conductive layer made of a different material from the first conductive layer. The filled first conductive layer and the second conductive layer are recessed so as to form a first gate recess. A third conductive layer is formed over the first conductive layer and the second conductive layer in the first gate recess. After recessing the filled first conductive layer and the second conductive layer, the second conductive layer protrudes from the first conductive layer.