Little archaeological evidence remains from Taiwan's early history. People - probably Pacific Islanders at first - may have lived here for about 10,000 years, with migration from China beginning in the 15th century. In 1517 Portuguese sailors reached Taiwan and named it Ilha Formosa, or beautiful island. The Dutch invaded in 1624 and built a capital at Tainan - two years later they lost the island to a Spanish invasion, but returned the favour by booting the Spanish out in 1641. During the 1660s the Ming and Manchu dynasties arrived on the scene, kicking out the Dutch and wrestling one another for control of the island. The Manchus eventually won, making Taiwan a county of Fujian Province and triggering a flood of Chinese immigration.
Japan took Taiwan from China in 1895 and held on to it until the end of WWII, when it was handed back to China. When Communist forces took control of China in 1949, the president, General Chiang Kaishek, and his nationalist party, the Kuomintang, fled to Taiwan to plan their reconquest of the mainland. They're still planning. One and a half million Chinese also left the mainland for Taiwan when Mao took control. The leaders of both Communist mainland China and the Republic of China (Taiwan) claim to be the voice of all China, but the international community has, almost without exception, chosen the mainland. In 1971 the Kuomintang lost the Chinese United Nations seat, and in 1979 the USA withdrew its recognition of the Republic.
When Chiang Kaishek died in 1979 and was replaced by his son Chingkuo, Taiwanese started muttering the word 'dynasty', and criticism of the one-party system rose. In 1986, those opposed to Chiang formed the Democratic Progressive Party, and were granted seats in the legislature. Two years later Chiang died and was replaced by the first native-born president, Lee Tenghui.
Taiwanese politics is divided among those who want reunification with China (the Kuomintang line), those who want Taiwanese independence and those that want the status quo preserved. In 1995 relations between the two Chinas, always chilly, plummeted to a new low. Lee Tenghui's high-profile visit to the United States brought mainland China out in a rash of nervous jealousy. Determined to isolate Taiwan and sway the minds of its voters, China held intense military exercises near the Taiwanese coast. In response, the United States donned its global cop hat and sent a couple of warships to monitor the situation. Despite the region's sudden high concentration of itchy trigger fingers, the first direct presidential election was held without incident, and Lee Tenghui was returned to office.
Taiwan's fortunes took a turn for the worse in September 1999 when a massive earthquake hit the island, the largest in its history, leaving over 2000 islanders dead and piles of rubbles strewn over the country. Even in this time of crisis, however, the snippety relationship between mainland China and the wannabe republic continued. A defiantly sulky China demanded that any country entering Taiwan to offer earthquake relief get permission from the Chinese government first: a demand that was met with less-than-hearty agreement from humanitarian organisations and other countries around the world.
March 2000, Taiwan elected its next president Chen Shui-bian, the candidate of Taiwan's Democratic Progressive Party, who believe in a formal declaration of independence for the island. The upset ended 55 years of Nationalist rule and alarmed China, which regards Taiwan as a rebel province.