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Using the data collected from various national poll surveys conducted after the transition to democracy in the late 1980's, this study analyzes the trend of national identity change among the general populace in Taiwan. Counter to the popular view that the nascent Taiwanese national identity rose at the cost of the orthodox Chinese national identity, this study argues that most people in fact upheld dual identity in the first two decades following the democratic transition. They acquired a new Taiwanese national identity without forsaking the old Chinese identity. In analyzing the phenomenon of dual identity, this dissertation challenges the conventional view that national identities are mutually exclusive. It also shows that the trajectories of the two national identities are different processes, having occurred during different historical stages and in different international environments. They were also the results of different political forces. In explaining the rise of Taiwanese national identity, this study focuses on the factors of state and politics, rather than history and ethnicity. It is contended that the new national identity is largely engendered by democratic institutions and political participation. It thus was able to co-exist with existing Chinese national identity. This dissertation then explains the decline of Chinese national identity not with the rise of Taiwanese identity, but with the rise of China. The dominance of the People's Republic of China (PRC) in the international community along with its staunch One China Principle has removed the important component of the Republic of China (ROC) from the Chinese national identity in Taiwan. Chinese unification no longer means the fulfillment of self-rule but to be ruled by another state (the PRC). People who have identified with the ROC no longer opt for a unified great China and hence forgo their Chinese national identity.