Sport and recreation is a booming and new economic industry in 20th century. The growth of the industry is so phenomenal that not only it has become the star industry in new millennium, but also it has a great influence over our society, culture, education, and politics. The purpose of this study was to examine the current sport and recreation industry and analyze the internal and external environment. The results of the study will benefit the future developmental strategy of sport and recreation industry in Taiwan. Document analysis and SWOT analysis were utilized to investigate the data. The data was analyzed by the SMILE model (product service, market and marketing, inno-value, life, and employment) which was proposed by the Council for Economic Planning and Development. After the data analysis, 15 developmental strategies were identified. The first six strategies were innovating and increasing the value of the sport and recreation industry, the internal environment of sport and recreation industry, the external environment of sport and recreation industry, the development of self-branding, the development of human resources, and strategic alliance. Based on the overall national strategy and the need of industry, the researcher suggested another 3 strategies, which were stabilizing the key role in Greater China and substantiating the life blood of Taiwan's industry, daring to go further west to challenge BRICs (Brazil, Russia, India, and China) economies, and being internationalized.