The current Taiwan Farmer’s Association is evolved from the centralized three level “Agricultural Associations” System that integrated “Industrial Cooperatives”, “Farmer’s Associations” and other related organizations in the period of Japanese occupation. However, there has been little research carried out concerning the Industrial Cooperative and Agricultural Association founded in Japanese ruling period. This research focuses on the pre war industrial cooperatives and agricultural associations, We will analyze the objectives behind their establishment, organization, operation, and development. Though this approach we will be better placed to understand both the system they employed and their essential characters. This, in turn, will allow us to fill in a gap in current research into the Taiwan Farmer’s Association. The major findings are as follows. 1. The reasons that the Japanese regime encouraged the formation of industrial cooperatives were: (1) A capitalist colonial policy to ensure Japanese control of all capital. Thus small farmers were helped to form industrial cooperatives in response to the new capitalist order. (2) Credit or purchasing cooperatives were set up to tie down the wages and laboring class immigrants that came form Japan. 2. Pre war industrial cooperatives are the direct forerunner of the current basic level Farmers' Association in Taiwan. In 1933 the controlling regime began to actively promote the use of credit, purchasing, sales and utilization cooperatives. These established a firm organizational foundation for the present multipurpose Farmers' Association in Taiwan. 3. Almost all industrial cooperatives and agricultural Association established under the Japanese regime were set up by Japanese officials from the top downwards. Such individuals were either instrumental in the formation of these organizations or even forced their establishment. Consequently, no organization was able to shed the image of being government made and controlled. As such, the willingness of members to cooperation was very weak, they were promoted form the cities to urban areas and from Japanese society to Taiwan society. At the beginning, the industrial cooperatives were mainly developed through a credit cooperative approach, also early industrial cooperatives remained heavily concentrated on landlord class. 4. Faced with a situation of economic depression the industrial cooperatives expanded quickly. In this way they did, to some extent, serve the function of stabilizing the rural economy and eliminating commercial capital. In the period before the establishment of a more integrated organization in July 1942 there was no cooperation between the various industrial cooperatives and there was no sharing of common economic benefits. Thus, their influence remained essentially the same as that of local business men. 5. Throughout the Japanese ruling period, and at the each stage of economic development, the industrial cooperatives served to eliminate rural usury, allowed for cooperative marketing of agricultural products and distribution of farm inputs0 Such as, they actively carried out government policy in the area of grain and financial controls, with forcible purchasing, storaging and the provision of materials, and were an important link in the political and economic system. 6. The post war three level agricultural association system made up of Taiwan agricultural associations, county agricultural associations and town agricultural associations formed the framework on which the current three level farmers' association was built.