About 20 military ships - half from China and half from Taiwan - are involved in a stand-off near the Taiwan Strait's sensitive median line, according to Reuters.
It comes as China says its military has carried out simulated precision strikes on "key targets on the island and the surrounding sea areas" during a second day of drills, and Taiwan reported multiple air force sorties by Beijing.
The mock air and sea attacks were on "foreign military targets" in waters off Taiwan's southwest coast.
"Taiwan is not their only target," said the unnamed source who was familiar with the situation. "It's very provocative."
The drills have not been as big as those that followed Nancy Pelosi's visit to Taipei last August.
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