Homeland Security Secretary Janet Napolitano described it as a "logical development in close security and people-to-people" ties between the U.S. and Taiwan.
From Dec. 1, Taiwan joins 36 countries whose nationals can travel to the U.S. for tourism or business for 90 days without a visa.
It is not a privilege enjoyed by China.
Coming during a U.S. election campaign where both presidential candidates are keen to show they are tough on China, the announcement could be timed to demonstrate the Obama administration is sticking up for self-governing Taiwan, an island China claims as part of its territory.
But the waiver is also viewed as a response to Taiwan lifting restrictions on U.S. beef imports and for President Ma Ying-jeou's easing tensions with China. It is unlikely to raise many hackles in Beijing.
Napolitano said she expected the waiver program to boost Taiwanese arrivals to the U.S. Some 290,000 Taiwanese visited the United States in 2011, spending $1.1 billion, according to the U.S. Commerce Department.
The announcement was made at a State Department conference on travel and tourism, where Secretary of State Hillary Rodham Clinton stressed the industry's importance for creating jobs and promoting economic growth. She said tourists from China and Brazil alone support more than 40,000 jobs in the U.S.
She said U.S. embassies around the world are expediting visa processing times. She said visa applications are up 40 percent in China and waiting times average five days.
The U.S. is careful in its handling of relations with Taiwan. Despite transferring recognition from Taipei to Beijing in 1979, the U.S. remains Taiwan's most important foreign partner, supplying it with virtually all of its imported arms, and providing a tacit -- and deliberately ambivalent -- shield against a possible attack from the mainland, 160 kilometers (100 miles) to the west.
But faced with Beijing's growing political and economic clout, Washington has also tried to lower its Taiwan profile, limiting the scope of arms shipments to Taipei that still anger Beijing.
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