As of 0230 GMT, the main TAIEX index rose 118.19 points to 8,745.97, after closing down 0.21 percent on Monday.
Foreign investors were net buyers of Taiwan stocks in Monday's session, boosting domestic sentiment.
The electronics subindex was up 1.24 percent, while the financials subindex was trading 1.9 percent higher.
Shares in AU Optronics Corp, which is due to issue its third-quarter earnings on Wednesday, were 1.9 percent higher.
Analysts said South Korean rival LG Display Co Ltd's strong results last week may point to solid results for the Taiwanese display maker.
The Taiwan dollar was up T$0.013 to stand at T$30.390 to the US dollar.