This study seeks to reinterpret Taiwan's democratic transition and the KMT's party transformation in the light of President Lee's leadership and his rise to power. Applying the neo-institutionalist approach, this study identifies Lee's leadership with “planful opportunism”, and examines each episode of Lee's maneuvre against the old ruling bloc and the resulting political changes. Besides, it also explores the accumulative effects of Lee's “opportunist” leadership and democratic reforms upon the KMT as a political party. It is argued that the KMT splits because Lee expands the scope of political conflict by launching political liberalization, which introduces proindependent forces to enter political arenas and polarizes intra-party conflicts. However, electoral expansion also generates edges for Lee to penetrate local politics via national means and finally enables him to assume plebiscitary leadership in engineering populist mobilization against local machines. Lee's rise to power is concomitant with the KMT's split and its transformation.