Sirens sounded at 1:30 p.m. (0530 GMT) for the mandatory street evacuation drills, which effectively shut towns and cities including its capital Taipei for 30 minutes.
An "air raid alert", asking people to evacuate to safety immediately, was sent via text message.
Tourists with luggage were seen taking shelter in a subway station, some shocked and not sure what had happened.
Other parts of Taiwan, where periodic air-raid drills are required by law, will carry out street evacuation drills this week.
Reporting By Angie Teo, Fabian Hamacher and Ann Wang; Writing by Yimou Lee; Editing by Lincoln Feast.
Persons:
Ann Wang, Tsai Ing, Wan, Lee Jang Ho, William Lai, Angie Teo, Fabian Hamacher, Yimou Lee, Lincoln
Organizations:
REUTERS, Facebook, Taiwan, Thomson
Locations:
Taipei, Taiwan, Ann Wang TAIPEI, Beijing, China, Ximending, South Korea, United States