An important process of economic reform in China has been to promote the inflow of foreign direct investment (FDI). After more than thirty years of economic reform, China has become one of the most important destinations for cross-border direct investment. Since Taiwan has become one of the major source countries of FDI in China, Taiwanese investment has experienced changes in spatial patterns and industrial composition since the 1990s. As a result of active government promotion through various policy measures, FDI in China has grown rapidly since 1978, especially in the 1990s. Taiwanese authorities released the investment strategy, “Be patient, No hurry”in 2001, and since then China has become the biggest target of Taiwanese investment outside of Taiwan; money from Taiwan forms a significant portion of foreign capital in China. Due to coastal and other geographical advantages of the three major economic regions possessing good investment environments (that is, the Pearl River Delta, Yangtze River Delta (YRD) and Bohai Bay economic region), the landscape of Taiwanese direct investment (TDI) in recent years has been moving Northward and Westward significantly. Initially, the Taiwanese investment in labor-intensive industries mainly concentrated in southern China, including Guangdong and Fujian, because of the cheap labor and geographic proximity. Since the mid-1990s, the industries of Yangtze Rive Delta region has become a new investment hotspot for Taiwanese enterprises while their industrial nature is changing to be more technology-intensive and domestic market-oriented.