Small and Medium Size Enterprises (SMEs) have played a crucial role in Taiwan's economic development However, in late 1980s there have been major changes in the macroeconomic environment in Taiwan. Large numbers of Taiwanese SMEs moved their operations overseas to low-cost production destinations. This paper will examine the process and motivation for internationalization among Taiwan's SMEs. It will analyze the current state of their overseas operations, then levels of internationalization, the business models adopted to develop overseas markets, and the problems encountered in trans-national marketing and management.