Theater in Taiwan originated in the Qing dynasty, where Nanguan opera was the main representative until the 18th century, and was subsequently replaced by Beiguan opera. In the early days of the Japanese rule, new school plays and Taiwanese plays were introduced as pioneers of non-traditional forms of opera/New Drama.In addition to North-South drama, there are other forms of drama, such as adult drama, Chao's play, 囝-seater drama, children's play, car drum play, skin ape play, puppet play and other emerging genres of opera.

Early modern theater in Taiwan New Drama Movement under Japanese rule (xinju) is a general classification for all theatre activities that were not traditional opera (xiqu). In New Drama, stories were set to be in the contemporary society. Actors were in contemporary costume and spoke vernacular language. Stage setting was in the style of modern theatre. The visual style was totally different from that of traditional xiqu. The stage design was historically accurate. The New Drama emerged in a very special social context in the history of theater in Taiwan. The development and decline of New Drama were strongly influenced by its political environments.

The historical trajectory of the trend of Reformed Drama (gai-liang ju) in Taiwan originally came from the Reformed (kairyō) Drama movement in Japan. The overseas students in Japan from Taiwan were heavily influenced by this new trend of drama. During the Reformed Drama movement in Taiwan, some traditional xiqu troupes adapted the traditional plays and set the story background in the modern time. The characters were in contemporary costume and spoke vernacular language. Some traditional opera troupes also attempted this new form of drama, mostly for commercial reasons, in order to find a new way to survive and be accepted by the market, in which traditional drama and new forms of drama were coexisting.

In 1921, the Taiwanese Cultural Association was established by Lin Hsien-tang, Chiang Wei-shui, , , and others, with the aim of promoting cultural enlightenment and awakening the national consciousness of the Taiwanese people. The association viewed traditional xiqu performances and folk rituals, including religious ceremonies, as tools used by the Japanese government to control and oppress the Taiwanese people. This perspective sparked the New Drama movement, as the association joined forces with young individuals who shared the same ideals, hoping to use theatrical performances to transform the societal culture and mindset of the era and elevate the cultural standards of the general population. During this period, the new plays were referred to as " (Wen-hua Ju)." However, the profound symbolism in Cultural Drama made it difficult for less educated citizens to resonate with, resulting in its main audience consisting of intellectuals, thus limiting its influence on popular education. With the division of the association, Cultural Drama gradually declined.

In 1924, while studying in Japan, encountered the Japanese little theater. Upon his return to Taiwan, he founded the Starlight (Xin Guang) Drama Club, introducing the latest stage concepts and techniques and driving the professional development of New Drama in Taiwan. Subsequently, Chang once again went to Japan to study actor training systems and the latest stage art techniques at the Tsukiji Little Theater. He also conducted in-depth research on the operation of professional theater groups.

Two years later, he returned to Taiwan and founded Min Feng Drama Club. During this time, in addition to teaching in the club, Chang also collaborated with intellectuals, such as Yang San-lang, , , and Yoshimune Katsuma, to offer a series of professional courses in stage arts, modern theatre, music, dance, and fine arts to the public. These endeavors brought innovative changes to Taiwanese New Drama, and Chang came to be recognized as "the Number One Person of New Drama in Taiwan."

Promoters of the New Drama movement aimed at replacing old style traditional xiqu with new formats of theater. They wanted to improve the cultural literacy of people and to promote progressive social ideas. The New Drama movement can be classified into two major categories: "pursuing artistic development" and "spreading propaganda for social reform."

The first category, "pursuing artistic development," was led by artists and groups such as Chang Wei-hsien with his Starlight Drama Club, Min Feng Drama Club, and Ding-Shin Club, as well as the Kosei Theatre Society founded by Lin Tuan-chiu, , , and other people. The second category, "spreading propaganda for social reform," was led by Taiwan Cultural Association and other similar political-oriented troupes.

Japanization (Kominka) movement period (1937–1945) After Chang Wei-hsien, the New Drama movement went quiet for a while, and it was not until Lin Tuan-chiu that the movement gained its new momentum. Lin also studied abroad in Japan, during which he actively participated in local theater troupes and worked in Toho Cinemas. These experiences allowed him to establish friendships with other Taiwanese artists who had also studied in Japan, including musicians , , and others. After returning to Taiwan, Lin Tuan-chiu was invited to direct the film version of Ali Mountain, a play written by . Lin Tuan-chiu soon became famous in the circle of New Drama movement in Taiwan. He was also invited to work in the Taiwan Drama Association, which was founded by the Japanese government for controlling the freedom of artistic creation in Taiwan. The association was in charge of the censorship of the plays and had the right to add changes and put limitations on the format of performances. Lin Tuan-chiu soon left the association and joined the New Drama movement that was closely monitored by the government.

On April 29, 1943, Lin Tuan-chiu founded the Kosei Theatre Society with the novelist Chang Wen-huan, the musician Lu Chuan-sheng, Lu He-ruo, and other intellectuals and youths from all over Taiwan. The aim of the society was to create Taiwanese dramas for Taiwanese audience. The Kosei Theatre Society was the last important New Drama troupe during the Japanese ruling period. Plays like Castrated Chicken reflected that even under the high pressure of colonial control, Taiwanese people were still longing for freedom. In the end, most of the youths and intellectuals in the Kosei Theatre Society were oppressed under the high pressure ruling by the government. Some people were sent to jail or even died. Others chose to leave the cultural circle.

The New Drama movement in Taiwan started in about the same time as the rising of the Taiwanese Opera (kua-a-hi). The Taiwanese Opera soon became the most popular form of folk entertainment after a short period of time. However, the New Drama still remained in the condition of sporadic amateur performances and could not become a substantial genre. The New Drama movement had a grand vision, but its development was limited due to social development and political conditions. The Japanese colonial government and later the Nationalist government both paid close attention to New Drama and attempted to suppress it. The productions of New Drama remained amateur without attaining higher artistic achievements. In addition, New Drama also lacked the entertainment value and could not engage with the audience. It did not become the mainstream of entertainment.

Early postwar period and after the Nationalist Government arrival in Taiwan From 1945 to 1949, the Nationalist government officially took over Taiwan from the Empire of Japan and established the . From the defeat of the Japanese empire to the total retreat of ROC government to Taiwan, there was a brief transitional period. During this time, the long-suppressed creative energy of New Drama started to flourish, primarily through the endeavors of the Seng Feng Drama Club, comprising Sung Fei-wo, Chien Kuo-hsien, Chang Wen-huan, and Wang Jing-chuan. Their performances drew an increasing number of individuals interested in theater. The Nationalist officials in charge of Taiwan at that time adopted a tolerance policy towards these performances and provided a brief friendly environment for New Drama to develop.

In 1947, the February 28 incident broke out, and was followed by the White Terror. Many intellectuals were killed or arrested during massive suppression, including several major Taiwanese theater artists. Theater activities with a critical voice to the society, such as New Drama, were silenced since then. The Taiwan Provincial Administrative Executive Office strengthened its control over theater activities and speech freedom in Taiwan by formulating the Regulations on the Management of Theatrical Troupes in the Taiwan Province, which requested that all theater performances and activities must be registered and reviewed in advance.

In 1949, the ROC government retreated to Taiwan completely and martial law was imposed in Taiwan. People in Taiwan were under another highly tightened political control after the Japanese ruling. All aspects of freedom, including thoughts, movements, languages, and personal freedom, were under control. The rule of the martial law lasted for 38 years and was finally lifted in 1987.

Theater activities during the martial law period became tools of political propaganda for the government to reinforce its political power, to strengthen its social control, to fight against the invasion of Chinese Communists and all the oppositional forces, and to control people's thoughts. In this period, the government promoted the slogan of "Combat Literature and Arts" and was enthusiastically supported by the literary and arts circles. In 1950, the was founded and offered a huge amount of monetary award for literary works that promoted national consciousness and anti-Communist ideology. Later, the founding of absorbed many theater artists as members. Together with the existing theater troupes in the troops, schools, and government units, these organizations helped raise the anti-Communist drama and literature to the highest position.

The anti-Communist drama was created to support the government for its political goals. In the political reality of that time, playwrights had no choice but to join the . Many anti-Communist plays were written in a short period of time. Since the topics were limited and the messages of ideology were straightforward, the plots of these plays were very similar and repetitive. It did not have much entertainment value. The audience gradually lost interest in these plays. In addition, high entertainment tax imposed on ticket sales and rental fees of the playhouses also became a heavy financial burden for theater troupes. Without audience support and steady income, most New Drama troupes with their repetitive plays fell into a gradual decline and disbanded.

Little Theater Movement in Taiwan First stage of the Little Theater Movement (1960–1984)