In Taiwan, sexual transmission is responsible for most HIV-1 infections with two dominant subtypes, subtype B and CRF01_AE, distributing among homosexual and heterosexual groups, respectively. Recently, intravenous drug use has become an emerging route of HIV-1 transmission and contributed to a significant increase of HIV-1 infection. To characterize the HIV isolates responsible for the outbreak among intravenous drug users (IDUs), phylogenetic analysis was performed to analyze the protease/RT sequences amplified from HIV-1-infected IDUs at National Taiwan University Hospital and Taipei City STD Control Center. CRF07_BC, which is circulating in northern China, was demonstrated to account for the majority of HIV-1 infection in IDUs in the past 2 years. Although these Taiwanese CRF07_BC sequences shared the same breakpoint positions as those described in the CRF07_BC reference sequences, they formed a unique cluster in the phylogenetic tree, suggesting they originated from a founder virus. This finding was further supported by the relative low genetic diversity and unique sequence features. Our results demonstrated the emergence of CRF07_BC and its association with the HIV-1 outbreak among IDUs between 2004 and 2005 in Taiwan. This finding not only helps us to have a better understanding of the HIV evolution in Asia, but also has important implications for vaccine design in the future.