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We report on the effect of Si/sub 3/N/sub 4/ passivation of the surface of AlGaN/GaN transistors on low-frequency noise performance. Low-frequency noise measurements were performed on the device before and after the passivation by a Si/sub 3/N/sub 4/ film. A lower level of the low-frequency noise was observed from the device after the passivation. The passivation layer improved high-frequency, large-signal device performance, but introduced parasitic leakage current from the gate. A lower level of flicker noise is explained by the fact that noise is mostly originated from the fluctuation of sheet charge and mobility in the ungated region of the device due to the defects on the surface and in the barrier of the unpassivated device. Passivation eliminates part of the defects and higher leakage current increases the number of electrons on the surface and in the vicinity of the barrier defects, lowering the contribution to the low-frequency noise according to Hooge's law.