To provide an electronic component which is small in size, ensures excellent impedance characteristic, and has a smaller DC resistance value, and also to provide a manufacturing method thereof.

The electronic component comprises a basic material 11 in which the external circumference is stepped down, a pair of terminal electrodes 4 which are provided to the base material 11 and include the external circumference which is larger than the base material 11, a conductive film 12 covered with the external circumference of the base material 11, a spiral groove 7 provided at the front surface of the base material 11, a recessed groove 6 provided at the boundary line where the base material 11 formed with the stepped-down area of the base material 11 and the terminal electrode 4 are crossing, and a magnetically insulated layer 5 formed to the front surface of the stepped-down area of the base material 11. In this electronic component, the recessed groove 6 and spiral groove 7 are connected with each other.