Former presidential candidate Hung Hsiu-chu was elected to steer the embattled party, despite being ousted last October for her conservative views.
The KMT not only lost the presidency to opposition leader Tsai Ing-wen in January's vote, it also lost control of parliament for the first time in the island's history as the public became increasingly uneasy over closer ties with China.
Hung -- whose stance leans towards pro-unification with China -- vowed Saturday to revive the party, which is also plagued by inner rivalries.
She obtained 56 per cent of vote, beating three other candidates including acting chairwoman Huang Min-hui and Taipei City councillor Lee Hsin.
Hung's victory also makes her the party's first woman leader.
Adding to Hung's tall task as the KMT's new leader is answering demands for the party to surrender its assets, which critics say have been misappropriated or misused.
Improved relations with China had been a cornerstone of KMT's policies under outgoing president Ma Ying-jeou over the past eight years, but many voters feel benefits have not trickled down.
The public -- especially the younger generation -- is also increasingly protective of Taiwan's way of life and democracy, much to China's chagrin.
Taiwan is self-ruling after splitting from the mainland in 1949 after a civil war, but Beijing still considers it part of its territory awaiting unification.
Chinese leaders will be watching Tsai's inauguration speech closely on May 20 for how she addresses relations with Beijing.
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