"Sinlaku is very powerful and it is expected to impact most parts of the island this weekend," a Central Weather Bureau forecaster said.
The bureau warned residents across the island, particularly those in coastal and mountain regions, to take precautions against flooding and mudslides as the typhoon is likely to generate rainfall of up to 1,300 millimetres (50 inches).
Organisers have been forced to cancel or postpone outdoor celebrations in Taipei and several other cities for the weekend's Mid-Autumn Festival as Sinlaku gained momentum.
Railway authorities have also suspended trains bound for the east coast later Friday, while night schools in several northern cities are to be closed.
At 5:30 pm (0930 GMT) Friday, Sinlaku was 230 kilometres (140 miles) east of Hualien on the east coast, packing winds of up to 184 kilometres an hour, forecasters said.
Two tropical storms pounded the island in July, leaving at least 22 people dead and causing hundreds of millions of dollars in damage to agriculture.
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