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This article examines local government reform in Taiwan. It highlights the challenges that new municipalities face in responding to rural – urban population, balancing centralism and localism, and protecting cultural diversity and minority rights. By applying Dillion’s rule and Home rule theories, it classifies two types of special municipalities, identifying their characteristics, advantages and disadvantages. The article is presented in three parts. The first part examines the structure of local government, then explains how local governments are established and their relationship with central government. The second part focuses on government reform, by highlighting the issues and concerns facing local and central governments, and their respective reforms. The third part classifies two types of special municipality governments, by examining how each type balances efficiency and democracy, and the needs of central government versus the local community. The article concludes with a discussion of future challenges facing local government and special municipalities.

The possibility of a New Type of Special Municipality: A Review of Local Government Reform Policy in Taiwan as a model for other global cities