Inductively-coupled $N_2$O plasma was utilized to grow silicon dioxide at low temperature and applied to fabricate polycrystalline-silicon thin film transistors. At $400^{circ}C$, the thickness of oxide was limited to 5nm and the oxide contained Si≡N and ≡Si-N-Si≡ bonds. The nitrogen incorporation improved breakdown field to 10MV/cm and reduced the interface charge density to $1.52$ imes$10^{11}$</TEX> $cm^2$ with negative charge. The $N_2$O plasma gate oxide enhanced the field effect mobility of polycrystalline thin film transistor, compared to $O_2$ plasma gate oxide, due to the reduced interface charge at the $Si/SiO_2$ interface and also due to the reduced trap density at Si grain boundaries by nitrogen passivation.