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In order to study the strain‐compensation effect by C atoms in solid phase epitaxial (SPE) growth of SiGe alloy layers, C sequential implantation was performed in  oriented Si substrates with various doses after high dose (5×1016/cm2) Ge implantation. When the nominal peak concentration of implanted C was over 0.55 at. % in the present sample series, misfit dislocation generation in the epitaxial layer was considerably suppressed. A SiGe alloy layer with 0.9 at. % C peak concentration under a 12 at. % Ge peak shows the greatest improved crystallinity compared to layers with smaller C peak concentrations. The experimental results, combined with a simple model calculation, indicate that the optimum Ge/C ratio for strain compensation is between 11 and 22.