The Dutch East India Company's ambitions in East Asia had been escalating for years. In 1622, the Company tried to establish a trading outpost on the Penghu Islands, strategically positioned in the Taiwan Strait between China and the open Pacific. Ming authorities refused to tolerate a European garrison so close to the Chinese coast and drove the Dutch out by force. The Company retreated eastward to Taiwan, where it built Fort Zeelandia on the islet of Tayouan, now part of the mainland at Anping, Tainan. From Zeelandia, the Dutch began importing laborers from Fujian Province and Penghu, many of whom settled permanently. A Scottish agent of the Company named David Wright, who lived on the island in the 1650s, described the lowland areas as divided among eleven indigenous chiefdoms, ranging from two settlements to seventy-two. Some accepted Dutch authority; others did not. The Company was building a colony, and Spain saw the threat clearly.

The Spanish fleet established its base at the northern tip of Formosa, in the natural harbor of present-day Keelung. They constructed Fort San Salvador, naming it for the Christian savior, and began the work of turning a remote coastline into a functioning outpost of the Spanish East Indies. The settlement was multiethnic from the start. Besides indigenous Taiwanese peoples, the Spanish authorities brought Sangley Chinese - primarily Fujianese traders - Christian Japanese exiles, Filipino laborers from Pampanga and Tagalog regions, and even soldiers and workers from New Spain who had crossed the Pacific via the Manila-Acapulco galleons. Catholic friars established missions. The fort served as both military garrison and trading post, its purpose to intercept Chinese merchant ships before they could reach Dutch ports to the south. Spain held this territory as Spanish Formosa, a modest colonial possession sustained by the logistics of the Manila trade network.

Spain's grip on northern Formosa was never strong. The garrison depended on supplies from Manila, where the colonial government faced its own pressures - indigenous resistance in the Philippines, competition from the Dutch across Southeast Asia, and the chronic financial strain of maintaining an empire that stretched from Mexico to the Moluccas. Reinforcements were sporadic. When Dutch forces moved against the Spanish positions, a combined garrison of Spaniards, indigenous Formosans, and Pampango soldiers from the Philippines held out for six days before being overwhelmed. The defenders eventually returned to Manila, surrendering their flags and what artillery remained. The governor who lost the territory, Corcuera, was imprisoned for five years in the Philippines for the defeat. Historians have debated his culpability ever since. The loss of Formosa owed at least as much to the rising power of the Dutch Empire in Southeast Asia and to mounting financial difficulties within the Spanish Empire as it did to any single commander's failures.

The Spanish presence in northern Taiwan lasted from 1626 to approximately 1642 - sixteen years that left physical traces still visible in the landscape. The foundations of Fort San Salvador lie beneath modern Keelung, and the harbor the Spanish chose for its natural protection remains the second-largest port in Taiwan. The Dutch, who took over the Spanish fortifications, reduced Fort San Salvador's size and renamed it Fort Noort-Hollant before eventually losing the island themselves to Koxinga's forces in 1662. The expedition's broader significance lies in what it reveals about seventeenth-century East Asia: a theater of competing European empires, indigenous societies navigating between them, and Chinese commercial networks that all parties were desperate to control. Formosa - the Beautiful Island - was not a backwater but a prize, positioned at the intersection of trade routes linking China, Japan, Southeast Asia, and the Pacific. The Spanish came to hold that intersection. They held it just long enough to prove it mattered.