Authorities revised the number of people who were still missing down from about 60 to seven on Thursday evening. Taiwan's Central New Agency reported that they were all guests at the Beauty Inn.
While search-and-rescue operations were under way, another 5.7-magnitude temblor hit late on Wednesday near the port city of Hualien, 120km south of the capital Taipei. Residents also endured more than 200 aftershocks on Wednesday and into Thursday.
More than 260 people were injured in the major quake that struck just after midnight on Wednesday, resulting in the collapse of a hotel and several other buildings, the National Fire Agency said.
Al Jazeera's Rob McBride, reporting from Hualien, said firefighters believe some 50 people remain trapped in one of the buildings that "simply toppled over".
"The rescuers have detected further shifts in the building [where survivors are trapped], and fear there might be a further collapse," he said.
"This is one of the problems they're contending with here, not only the weather - but the continuing aftershocks."
Media reports showed images and footage of leaning buildings and cracked pavement.
"Buildings simply toppled over crushing floors… It is believed that a number of people will have died," McBride said.
Hualien, a tourist city surrounded by mountains, is home to about 100,000 people.
The island has seen similar earthquakes as it sits in the so-called Ring of Fire, an area in the Pacific Ocean where earthquakes and volcanic activity is common.
In September 1999, a 7.6-magnitude earthquake in Taiwan killed more than 2,400 people and left 100,000 homeless.
|A firefighter searches for survivors in Hualien on Wednesday [Tyrone Siu/Reuters]|