Drawing on the two-level punctuated-equilibrium theory developed in the previous chapter, this chapter analyzes what I term Taiwan’s “double dilemma” in shaping its mainland policy. Internally, Taiwan’s increasingly polarized two-party system has transformed cross-Strait affairs into the centerpiece of electoral competition. Since 2016, the DPP has effectively framed itself as the defender of sovereignty and democracy, securing three consecutive victories in 2016, 2020, and 2024. By contrast, the KMT appeal to peace, prosperity, and closer economic engagement with the mainland has struggled to resonate with an electorate shaped by identity consolidation and growing security anxieties. Externally, Taipei confronts intensifying rivalry between Beijing and Washington, which further narrows the scope of policy maneuverability. The convergence of U.S. and PRC pressures has repeatedly constrained Taipei’s options, forcing its leaders to navigate between deterrence, reassurance, and symbolic assertion of autonomy. Taken together, these dual pressures constitute Taiwan’s double dilemma. They create a cyclical pattern of policy innovation punctuated by constraint, as moments of domestic mandate or international opportunity are quickly offset by structural limits. This chapter argues that the ways in which Taipei manages this double dilemma will be decisive in shaping its cross-Strait policy trajectory in the coming years and decades.