Abstract The development of fiber optics industry in Taiwan , comparing with advanced countries is a model of the development of the catching-up economies. The developed countries have already accumulated enough resources and capabilities from the past centuries to build the ability of R&D innovation , processing innovation, and assembly innovation in sequence. The catching-up countries are unable to obtain the same power and financial status as that of the developed countries are primarily due to the less technological advancement. The catching-up economies must initially proceed with the method of reverse engineering. The step initiates with creating the assembly innovation and ends with research pertinent to the utilization of intensive brain-power. The research studies attempts to integrate several related theories and models and form an analytical structure for fiber optics industry in Taiwan. The research studies also discusses the feasibility of fiber optics in Taiwan from both market and technological view , generates several conclusions from the studies , and makes a lot of strategic suggestions for fiber optics industry in Taiwan.