An AFP journalist in the capital Taipei felt tremors for nearly a minute as the shallow quake struck shortly after midnight.
The epicentre was recorded 12 kilometres (7.5 miles) north of Yujing, a mango-growing district in southern Taiwan, the USGS said.
Firefighters rescued three people including a child who were trapped in a collapsed house in nearby Nanxi district, video posted on Facebook and verified by AFP showed.
Elsewhere, authorities said a person was injured by falling debris while two people were rescued from elevators.
More than 50 aftershocks have been recorded, said Taiwan’s Central Weather Administration which reported the initial quake at magnitude 6.4.
The ceilings of several homes collapsed, while roads were blocked by falling rocks and landslides, the National Fire Agency said.
But the agency reported “no major damage” from the quake, which injured 27 people according to the health ministry.
The aftermath saw classes and office work cancelled in Nanxi district as well as Dapu Township in mountainous Chiayi County, north of the epicentre.
Some roads in Dapu were “damaged and impassable”, and water and electricity supplies affected, Chiayi County chief Weng Chang-liang said.
Taiwanese chipmaking giant TSMC said it evacuated workers from some of its central and southern factories when the quake struck.
Taiwan’s enhanced warning system