Religion in Taiwan is extremely complex. it is a mixture of folk religion and traditional Chinese religion.

Folk religion in Taiwan may be described as animistic, polytheistic and syncretistic. It is animistic because Taiwanese people firmly believe that spiritual forces have power over their daily lives. It is polytheistic because people believe in and worship multiple gods. It is syncretistic because Taiwanese have blended many varied and even contradictory religions and folk beliefs.

Traditional Chinese religion is a combination of ancestor worship, Taoism, and Buddhism. Although each religion has its own deities and teachings, they are often mixed so thoroughly that it becomes impossible to determine what is Taoist and what is Buddhist. For example, the Taiwan folk deity, Matsu (Goddess of the Sea) and the Buddhist Goddess of Mercy, Kuanyin, are frequently worshipped in the same temple.

Various occult practices like fengshui, fortune telling, buying amulets, conversing with spirits, and spirit possession are extremely common.

More than 16,000 registered temples cater to the spiritual needs of Taiwan's people. In fact, Taiwan has more temples per capita than any other country in the world.

The Taiwanese working class also believe in ghosts. They believe that every person who dies becomes a ghost. There are happy ghosts and hungry ghosts. Happy ghosts are those who are "fed" or worshipped with offerings of incense, food, and "spirit money". Hungry ghosts are those who are not worshipped. Hungry ghosts bring havoc upon an individual or family in the form of sickness, family relationship trouble, or financial loss. These hungry ghosts are often believed to be deceased family members who are not being worshipped properly or those who have died under tragic circumstances, such as drowning.

No one wants to be a hungry ghost. Therefore, ancestor worship has two main purposes. One is to ensure that one's ancestors do not wreck havoc on one's life. The other is to set a strong example to one's own children so that they will worship their parents after their death. As a result, worship of ancestors is considered extremely important. So important, in fact, that children (especially oldest sons) are told by their parents not to become Christians because then "you will not be able to worship me after I am dead, and I will become a hungry ghost."

Worship of gods is slightly different from that of ancestors. Taiwanese appease ghosts/ancestors but make deals with gods. Usually, a person provides a god with worship, incense, and food in exchange for protection, assistance, or blessing. The most desired type of blessing is generally related to money.

Taiwanese people are very religious. But all this religious activity provides no assurance for a happy life, both now and beyond the grave. Rather, it leaves people in fear and uncertainty.