Indigenous community-based education argues that indigenous peoples are the subject of educational systems and institutions whose needs should be fulfilled. This concept is also reflected in Indigenous Education Law in Taiwan. This case study is based on the theory of indigenous community-based education and focuses on the first indigenous integrated secondary school in Taiwan, Lan-Yu High School, trying to understand the implementation of the school and the challenges it faced. The research was conducted from August 2007 to July 2008. Its data was collected through interviews with teachers, students, and community members, as well as by participant observation. The findings showed that the integrated secondary school improved educational equality for the most disadvantaged students, that the financial subsidies helped to promote balanced development of secondary education, and that the cultural curriculum improved the relationship between the school and the community. However, neither the policy nor the budget could totally fit local needs because there was limited participation from the community and the schools. Therefore, the indigenous community remained to be mobilized and empowered to participate in the running of the school.