The move came as the United Nations said international aid needed for the affected areas was likely to exceed the record UN appeal of 1.6 billion US dollars for Iraq last year.
One of Taiwan's leading Buddhist organisations, Tzu Chi, said it planned to mobilise at least 500,000 followers here and elsewhere in the world to raise money in a campaign called "Let Love Flow into South Asia; Let Sympathy Sooth Painful Suffering".
"At least 500,000 Tzu Chi people will take to the streets for a week or two," a Tzu Chi spokesman told reporters, without specifying the targeted amount to be raised.
Tzu Chi followers in the United States, Malaysia and Canada will kick off the global roadside fundraising campaign Thursday and Friday, to be followed by their peers in Hong Kong, Japan and Taiwan.
Several other Buddhist organizations, such as Fokuangshan Monastery and Lingyen Mountain Buddhist Temple, are also mobilizing to raise money and materials.
The government Wednesday pledged five million US dollars in aid to tsunami-devastated countries and said it was organizing a 100-member medical team.
Taiwan's national space programme, meanwhile, offered to provide satellite images of the damage to affected countries and aid groups for free.
Two relief teams from Taiwan on Tuesday left for Indonesia and Thailand, taking with them tons of medical and relief supplies.
One Taiwanese national was killed when tsunamis devastated Phuket island in Thailand. Two Taiwanese are still missing.