Taiwan is one of the leading Asian countries that has achieved significant economic growth due to its focus on developing industrial clusters since the mid- mid-eighties. This study examines the impact of industrial clusters on economic growth in Taiwan by analyzing the evolution of these clusters and understanding how they contribute to enhancing GDP and the competitiveness of Taiwanese industries. The study employed a standard model based on multiple regression analysis to study the relationship between the number and size of industrial clusters, exports, total factor productivity, and innovation, represented by patent numbers and research and development expenditure, and Taiwan's GDP. STATA software was used for the statistical analysis, and the results showed that variables such as the number and size of industrial clusters, exports, and total factor productivity have a statistically significant positive impact on Taiwan's GDP. The results revealed a long-term equilibrium relationship between the growth of industrial clusters and GDP, emphasizing the importance of these clusters in promoting innovation and productivity. The study recommended enhancing supportive policies for industrial clusters and increasing investment in research and development. The Arab Republic of Egypt can benefit from Taiwan's experience by developing advanced technological industrial clusters, supporting innovation, and investing in research and development, thereby increasing GDP and enhancing the competitiveness of Egyptian industries, creating new job opportunities, and increasing exports. Keywords: Industrial clusters, Economic growth, Taiwan, VAR model, GDP, Productivity, Innovation.