W UMa-type contact binaries are composed of two late-type main-sequence stars, where both components are filling their critical Roche Lobes and sharing a common convective envelope. Their formation and evolution are unsolved problems in stellar astrophysics. This kind of binary systems have the lowest angular momentum and shortest orbital periods among main-sequence binaries. One of the possibilities for their origin is that the angular momentums of binary stars are transferred from the central binaries to close-in companions. In this paper, we will summarize some of our recent progresses on searching for close-in companions to contact binary stars, including the closest stellar companion to a contact binary at an orbital separation of about 0.8 AU. Then, based on the observational properties of those close-in companions, the formation and the evolution of contact binaries will be discussed.