Abstract: The dissertation explores the adaptability of Taiwan's IT industry in the transformation from the personal computer sector to the handset sector and the transplantation from Taiwan to the Yangtze River Delta region (YRD), China. It proposes a systematic approach from the bottom-up perspective, which on the one hand transcends the limited scope of existing approaches offered to explain Taiwan's late development, and on the other hand, rejects the rigid framework of the global production network (GPN) approach that is flagship-centric, exogenously-driven, market-oriented and power-static, with the intention of embracing the multi-faceted dimensions of the processes involved in the transformation and transplantation of Taiwan's decentralized industrial system. Based on two fieldwork trips in both Taiwan and the YRD region in which more than sixty interviews were conducted, this dissertation has three main findings. First, at the systematic level, the adaptability of Taiwan's IT industry came from the multiplicity of coordination mechanisms embedded in the industrial system, which provided interconnected and interdependent actors in this system with a variety of ways to respond flexibly and collaboratively to technological, organizational and geographical change. The restructuring of the handset global production networks (GPN) set up a backdrop for the flexible adaptation of Taiwan's IT industry to take place. By way of decentralized collaboration, Taiwan's IT industry not only built up capabilities rapidly around handset manufacturing by grasping opportunities in the value chain, but also was able to upgrade rapidly by taking advantage of tensions in the structure. Second, at the sectoral level, the decentralized collaboration was at work simultaneously at three different scales. At the global scale, it was a structural coupling between the handset GPN and Taiwan's PC industrial system that triggered the transformation. Although due to different sectoral characteristics, there were substantial differences between these two systems, and the interactive process has had mixed results. At the cluster level, three coordination mechanisms were in play to facilitate the adaptation. First, the intra- and inter-firm networks allowed firms to redirect and reorganize resources and capabilities within and outside the firm boundary. Second, the state offered a helping hand in supporting the transition through state-funded R&D projects, talent training and the improvement of the economic infrastructure. Third, the technical community acted as a vehicle for brain circulation across sector and border. At the firm level, the emphasis was mainly put on the learning process, in which five channels were used alternately: technology transfer, merge and acquisition, reverse engineering, training programs, and scaling up. Although these are strategies common to firms all over the world, however, due to rapid brain circulation, the knowledge and expertise had been diffused among all major players within only a few years. Third, at the spatial level, the decentralized collaboration was at work in the process of mutual institutional building. The ecological fit between Taiwan and Suzhou should be regarded as a collaborative initiative jointly promoted by both parties rather than an imperative driven by exogenous force or by local state activism only. In this process, the relationship between the Taiwanese managerial communities and Chinese local cadres was most worthy of investigation because these two groups of actors were indeed the 'visible hands' behind the transplantation. The close collaboration between Taiwanese firms and Chinese local states explained why Taiwan was so successful in tapping into Chinese local resources where Taiwanese investment was prominent, not only in scale but also in scope.