A semiconductor structure includes a substrate; first and second fins extending from the substrate and oriented lengthwise generally along a first direction; an isolation feature over the substrate and separating bottom portions of the first and the second fins; first and second epitaxial semiconductor features over the first and the second fins, respectively; and a first dielectric feature sandwiched between the first and the second epitaxial semiconductor features. A maximum width of the first dielectric feature is smaller than a width of the isolation feature between the first and the second fins along a second direction perpendicular to the first direction.