The emergence of "Taiwan identity" following the island state's democratization in the late 1980s has been a focal point of scholarly attention. This is due to the subject's implications for China-Taiwan relations, and hence the long-term aspect of war and peace in East Asia. All available social survey data indicates that, in the past three decades since democratization, more and more Taiwan citizens have come to identify themselves as "Taiwanese" instead of "Chinese." This is despite close contact and economic integration between Taiwan and China, and both inducive and coercive measures by the Beijing authorities to bring the islanders into the fold of the PRC. The Taiwan identity has, without doubt, become more salient. Yet underneath this salience is a nation deeply divided by different versions of nationalism and historical memory. This paper argues that our perception of Taiwan identity remains largely superficial without a consideration of the contending memory and identity politics on the island. It offers an alternative way to understand the formation of Taiwan identity by examining conflicting views on the Nationalist martial law rule during the Cold War. The paper will focus specifically on the contention surrounding the Nationalist White Terror suppression in the 1950s.