To provide an optical element including a surface-emitting type semiconductor laser and an photodetector element, which can be processed with a high accuracy, and its manufacturing method. An optical element in accordance with the present invention includes a surface-emitting type semiconductor laser including, above a substrate, a first mirror, an active layer and a second mirror disposed from the side of the substrate, and a photodetector element, provided above the surface-emitting type semiconductor laser, including a first contact layer, a photoabsorption layer and a second contact layer disposed from the side of the surface-emitting type semiconductor laser, wherein an isolation layer is provided between the second mirror and the first contact layer.