The roles ofDXcenters and surface states associated with then‐AlGaAs layer of &dgr;‐doped AlGaAs/GaAs high‐electron‐mobility transistors have been investigated by employing a two‐dimensional, self‐consistent ensemble Monte Carlo simulation. It is found that bothDXcenters and surface states degrade device performance, particularly as gate‐to‐source voltage increases. This degradation is manifested largely through reduced channel electron concentration, increased intervalley scattering, and enhanced real‐space transfer. Of the two defect states,DXcenters have more detrimental influence on drain current and transconductance.