We present an In0.49GaP/Al0.45GaAs barrier enhancement-mode pseudomorphic high electron mobility transistor (E-pHEMT) with a high gate forward turn-on voltage and a high drain current linearity. Device simulation shows that the normally observed transconductance reduction at a high VGS in E-pHEMT with a high gate turn-on voltage is closely related to the low electron carrier density of the gate side recess region to the source. We insert Al0.45GaAs into the barrier for a higher gate forward turn-on voltage and adopt In0.49GaP as an etch stop, which has less surface defects, for a higher transconductance at a high gate bias. The fabricated 0.5 µm E-pHEMT exhibits a gate forward turn-on voltage of 1.05 V, a drain current of 450 mA/mm at Vgs=1.5 V, a high transconductance of 470 mS/mm and a high linearity with gate swing for a transconductance flat region of 0.7 V.