To ensure the quality of a semiconductor layer in a region, where a transistor is formed and to stabilize the connection between one of source/ drain and a storage electrode.

A capacitor formed by embedding storage electrodes 8 and 10 in a trench selectively provided in an Si substrate 1, a first epitaxial Si layer 12 formed while being insulated from the storage electrodes 8 and 10 on the substrate 1 and the upper part of capacitor, a connection electrode 14 embedded in a connection hole 14 provided by partially removing the Si layer 12 to establish contact with the storage electrodes 8 and 10, a second epitaxial Si layer 17 formed at the upper part of the Si layer 12 and the connection electrode 16, and an MOS transistor formed at the Si layer 17, are provided. The connection electrode 16 is insulated from the first Si layer 12 in the direction parallel to the substrate, while being connected to either one of source/drain of the transistor through the second Si layer 17 in the direction of substrate thickness.