The movement of "Encouraging Children to Read" that started in 2000 kept on going in 2001. We can see that the importance of encouraging children to read is highly emphasized or talked about in many publications or activities and seminars held during the year of 2001. In addition, we observe that Taiwan children's literature had found a balance point between cosmopolitanizing and localizing in its way of developing in 2001. Firstly, the illustration exhibitions had shifted their focus from award-winning illustrations abroad to the ones drawn by local illustrators. Some picture books that described traditional Taiwan culture are also published. Besides, more illustrators who show the essentials of local culture with their paintings won international awards than ever. It means their efforts had been highly admitted. This article tries to make a clear list of the works written about or activities held on children's literature in 2001, through the aspects of publication, activity, teaching and studying, and literary research. It also states some observations on the development of Taiwan children's literature through the past year.