Taiwan’s local administrative districts have not been fundamentally adjusted for the needs of national development based on the post-war rapid urbanization. The state established direct-controlled municipalities which have the same status as province and empowered them with local financial and personnel privileges, so the fair distribution of national resources for people’s equal protection was distorted. Since the power of the Taiwan provincial government was diminished, the superiority of direct-controlled municipalities is even more prominent. When Ma Ying-jeou took office in 2008, the administration has not reviewed the local governmental system and the reorganization of administrative territory system, but established three new direct-controlled municipalities and formed a new administrative map of five direct-controlled municipalities and seventeen counties. This paper aims to review the new administrative territory system its impact on the national development and propose critics with reform proposals.