Language is one of the most important cultural features of a group and often acts as the principal marker of ethnicity. Under the governance of non-indigenous polities, Taiwanese indigenous peoples were expected to abandon their “backward” cultures and languages throughout both Japanese colonial and early KMT eras. Under those circumstances many indigenous languages disappeared or are now in danger of disappearing. In efforts to draw attention to the global crisis of language loss, in recent years, UNESCO recognized five different Taiwanese indigenous languages as “critically endangered.” One of these is the Thao language, now spoken by fewer than 10 native speakers. In response to this crisis, the Taiwanese government started the Salvage Endangered Languages Project and the Indigenous Language Proficiency Test with the explicit goal of saving endangered languages (and cultures) like Thao so that Taiwan can maintain a cultural diversity that will continue to distinguish Taiwan from China. However, among Thao people, the Thao language has long ceased to be a meaningful cultural and ethnic marker. Most Thao parents do not think of the Thao language as an essential culture that their children have to learn. In such a situation, how does language serve as an ethnic boundary? This paper discusses the loss of the Thao language in historical context, explores the status of the Thao language within the Thao community, and examines the efficacy of Taiwan’s language salvage project. I also analyze how the relationship between ethnic identity and language in the Thao society are affected by Taiwanese state policies with relevance to China.