A total of 1,000 officers were deployed overnight to remove the protesters from the Executive Yuan where the cabinet is located, Taipei's police department said, adding that 32 people were arrested.
In wild scenes, demonstrators pulled down barbed wire barricades surrounding the government building, and used ladders to break into offices on the second floor.
Clashes broke out when police tried to remove the protesters from the building and the compound surrounding it, with many lying on the ground with their hands linked to try to defy efforts to shift them.
One injured male protester lay on the ground being attended to by medical personnel while another was led away with blood streaming down his face, AFP journalists saw.
Taiwan's TVBS news channel said around 120 people were injured in the clashes, but police were not immediately able to confirm the figure.
National Taiwan University Hospital which is located near the government headquarters said it had treated 57 injured people and police officers since late yesterday.
Opponents say it will damage Taiwan's economy and leave it vulnerable to political pressure from China, allegations rejected by Taiwan's ruling Kuomintang party.
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