The quake, with a magnitude of between 6.7 and 7.2, was felt throughout Taiwan, Japan's Meteorological Bureau said. It swayed buildings and knocked objects off the shelves in the capital, Taipei.
The bureau said the 3-foot-high tsunami was expected to hit Basco in the Philippines.
"There is a possibility of a destructive local tsunami," the bureau said.
Taiwan's Central Weather Bureau said the quake measured magnitude 6.7, while the U.S. Geological Survey and Japanese bureau put it at magnitude 7.2.
No damage or injuries were immediately reported.
The tremor was centered at sea about 13 miles southwest of Hengchun on the southern tip of Taiwan, the bureau said. Hengchun is about 260 miles south of Taipei.