Technology transfer has a profound impact on a growth of a nation’s economy. It’s existing importance is not less than the invention and development of technology. Nowadays, universities are gaining its spotlight within the development of industry technology transfer, by seizing a handful of innovative inventions, and containing skilled professors and graduates in many professional areas. Especially since the 1980s when we see many successful experiences in the U.S., the transfer of technology from universities to industries has become a significant goal for governments across nations. The inflection point of U.S. technology transfer from universities to industries occurred in 1980, when the U.S. Congress passed the Bayh-Dole Act. This law allows any university to retain title to inventions arising from its federally funded research, and to grant licenses. It is widely agreed by scholars that the Bayh-Dole Act has been a success, particularly in terms of stimulating technology transfer and patent applications. For example, the number of licenses granted by universities has increases at least ten-fold, and royalties paid to universities almost quadrupled between 1981 to1992, and again doubled between 1991 and 1995. On the other hand, Japanese universities have enthusiastically embraced academic patenting, since the Incorporation of national universities, by increasing their reliance on Intellectual Property Rights (IPRs) strategies to do technology transfer. At the governmental level, many regulations have been enacted since the mid-1990s in order to promote university-industry relationships. For example, the 1998 Law to Promote the Transfer of University Technologies (the TLO Law) legitimized and facilitated transparent and contractual transfers of Technologies from universities to industries, and the 1999 Law of Special Measures to Revive Industry, which is called the Japanese Bayh-Dole Act, allowed universities to retain patent right. Similar to the Science and Technology Basic Act of Japan, the Taiwan government enacted the Science and Technology Basic Act in 1999, for the purpose of enhancing the competitiveness of Taiwan’s Economy, to set guidelines and principles for the promotion of science and technology development. In particular, the section 6 of this Act adopted the Bayh-Dole Act of the U.S. to release the ownership of R&D results from the government to universities. After the passage of this Act, universities are allowed to receive royalties from licensing patent rights to private industry for further development and commercialization. Indeed, it resulted in a significant increase of patent application by universities. However, some critics argued that detrimental effects of technology transfer will also impact universities, such as conflicts of interest and restriction on accessibility to knowledge. In contrast, some scholars, in favor of university-industry relationship, advise the legislators to ease the restrictions on licensing universities’ inventions in the Science and Technology Basic Act. Moreover, according to accountable statistics, the performance of technology transfer in Taiwan’s universities is not mature enough in comparison to the U.S. and Japan. To further discuss, using the U.S. and Japan as reference, this thesis primarily focuses on two topics. First, to provide certain suggestions on how to deal with the legislative defects and control side effects from technology transfer. Secondly, to find a way to improve the efficiency of technology transfer from universities to industries in Taiwan. In the end, this thesis hopes to clarify the misconception on the effectiveness of Technology Transfer. Although the financial return for universities from technology transfer is, on average, fairly modest, but the benefits should be emphasized on other perspectives other than financial results. For example, new medicines and other important products for the public; industrial collaborations based on universities-owned IP; job creation; and the development of entrepreneurial skills by faculty and students. In spite of the existing legislative obstacles and side effects, which should be noticed by legislators and administrators, the future of technology transfer between universities and industries in Taiwan is still believed to be promising.