A Taiwanese warship mistakenly fired a supersonic "aircraft carrier killer" missile towards China on Friday, killing the captain of a Taiwanese fishing boat.
The ministry of defence said three other people on the boat were wounded as the missile "pierced through" the vessel.
The Hsiung-feng III (Brave Wind) missile was launched during a drill around 8:10 am from a 500-tonne missile ship and it flew about 75 kilometres before landing in the waters off Penghu, a Taiwanese-administered island group in the Taiwan Strait.
The navy said it was not clear how the missile got activated but an investigation is underway to determine the cause of the accident.
"Our initial investigation found that the operation was not done in accordance with normal procedure," the Vice Admiral Mei Chia-shu told Reuters.
The vessel was at the Zuoying naval base in the southern city of Tsoying when the incident occurred.
Mei said helicopters and navy ships were sent in search of the missile. He also added that the National Security Conference, the top security body of Taiwan, was alerted about the blunder.
However, Taiwan's Mainland Affairs Council, which handles China policy, did not comment on whether the incident had been reported to Beijing.
Since President Tsai Ing-wen of the China-sceptic Democratic Progressive Party (DPP) was elected in January, the relationship between Taipei and Beijing has apparently deteriorated.
Although both the nations split in 1949 following a civil war, China still claims Taiwan as part of its territory.