Method of manufacturing a semiconductor device with self-aligned contacts

A method of manufacturing a semiconductor device on a semiconductor substrate having a first region and a second region. This method beings by forming a transistor in the first region of said semiconductor substrate. This transistor includes a pair of impurity diffusion regions and a gate electrode. Then forming a first insulating film over the first and second regions with this first insulating film covering the transistor in the first region. Thereafter, patterning the first insulating film to selectively remove the first insulating film in the second region. Then forming a second insulating film over the first and second regions. Thereafter, forming at least one contact hole through the second and first insulating film. The contact hole reaches one of the impurity diffusion regions. Finally, forming a conductive layer in the contact hole.