This study explores the interaction among Han people, "Shufan" (i.e., Reilang "she") and "Shenfan" (i.e., Malaifan, also called Mstranan during the Japanese colonial period and named Atalya today) around Wulixue River (i.e., Jingmei River) and the upstream of Xiulang River (i.e., Xindian River). Utilizing historical data, land contracts, maps and field work, this study analyzes how immigrants settled in the new environment and the relations between Hans, "Shufan" and "Shenfan" in borderland Taiwan. The nature of "Shan shui yin" is also examined. While focusing on the function of "Ai" (military community, "she ai fang fan"), this paper describes how "Aiken" (land reclamation by military community) offered a legitimate excuse for Hans and "Shufan" outside the boundary to move into and exploit the territory of "Shenfan". This study also shows that immigrants paid tax, "Shan shui yin", to both "Shenfan" and "Shufan" who owned the hillside land and shared its use with new settlers until early Japanese rule. Compared with "An fu fan zu" (i.e., Fan "shi zu") paid by immigrants in the mountain areas of central and southern Taiwan including "Alishan fan zu" (10% of total harvest), "Kang wu zu" (5% of total harvest), "Fu fan zu" (5-10% of total harvest), and the rate of "Shan shui yin" was relatively low. This study challenges the prevailing conception that "Shan shui yin" was the same as "Fan da zu", rental payment from migrant tenants to native landlords for use of land. Neither was "Shan shui yin" equivalent to "Fan shi zu", a recompense paid by immigrants to natives for maintaining a stable social relationship. Furthermore, land reclamation approaches adopted by immigrants in the north and south of Zhuoshui River varied mainly because of socio-cultural differences among aboriginal tribes.