The Institute of Physics was founded in Shanghai in 1928 and was reestablished in Taiwan in 1962, with Dr. Ta-You Wu as its first Director. The succeeding Directors of the Institute were: Dr. W. N. Wang (1976-1977), Dr. E. K. Lin (1977-1989), Dr. L. T. Ho (acting, 1989-1990), Dr. T. T. Tsong (1990-1999), Dr. Y. D. Yao (acting, 1999-2002), Dr. Maw-Kuen Wu (2002-2004), Dr. S. P. Li(acting, 2004- 2006) , and Dr. Maw-Kuen Wu (2006- present). In 1966, the Institute, together with the National Tsing-Hua University and the National Taiwan University, co-organized the Physics Research Center, under the auspices of the National Science Council, in order to promote physics research in Taiwan. In 1970, an interdisciplinary research program for atmospheric science and fluid mechanics was initiated in the Institute of Physics, and later a similar program for biophysical research in 1975. During the First Five-Year Plan (1981-1985) of the Academia Sinica, the original two-story Physics Building was replaced by a four-story building at the same site in April, 1983. The Institute's scope of research was then further expanded to include theoretical physics, covering mainly field theory and particle physics, nuclear physics, and statistical and computational physics. Since the beginning of the Second Five-Year Plan (1986-1991), the Institute has continued to grow, both in research staff and facilities. To meet the demands of rapidly growing research activities in the Institute, a new ten-story building immediately adjacent to the original building was completed in 1999. The Physics Building is named the "Ta-You Hall" to commemorate its first director, who passed away on March 4, 2000. 

At present, the Institute has 44 research staffs: 5 distinguished research fellows, 23 research fellows, 9 associate research fellows, 2 assistant research fellows, 2 senior research scientist, and 3 associate research scientists. The Institute also maintains 480 temporary employees, which include visiting scholars, postdoctoral research associates, as well as research assistants and graduate students. Current research areas can be grouped into three main categories: Quantum Materials Physics, Physics of Active Biological Systems, Medium and High Energy Physics. The Institute of Physics is expected to play an increasingly important role in the development of physics and technology in Taiwan.