This study examined the effect of the Baby-Friendly Hospital Initiative (BFHI) on the breastfeeding rate in Taiwan and analyzed factors related to BFHI qualification. The assessments included 56 hospitals enlisted for appraisal and 7,563 mothers in the maternity wards of these hospitals. Among the 56 hospitals appraised, 38 (67.9%) passed appraisal. Geographically, 88.5% (23/38) of hospitals are located in northern Taiwan, and only one hospital is situated in eastern Taiwan. All 13 medical centers enlisted for appraisal were qualified as BFHI. Only one private clinic passed the appraisal. We found close correlation between the location of the hospital and passing the appraisal (chi2 = 12.71, p < 0.01), and between the grade of a hospital and BFHI qualification (chi2 = 9.17, p < 0.05). Of the 10 steps to successful breastfeeding practiced in these hospitals, we found that step 10 got the highest scores, with a gain point rate of 94.64%; nonetheless, step 1 had significant power of discrimination regarding appraisal. Statistically, steps 7, 1, and 2 were more significant than any of the other steps. Mothers in qualified baby-friendly hospitals had higher breastfeeding rates than those in non-qualified hospitals, whether they were surveyed while in maternity wards after delivery (88.1% vs 78.1%) or in their first postnatal month (67.6% vs 59.4%). In conclusion, our study indicates that health policy intervention has a significant impact on increasing the breastfeeding rate in Taiwan.