This case study investigated undergraduate students' first experience in online collaborative learning in a project-based learning (PBL) environment in Taiwan. Data were collected through interviews of 48 students, instructor's field notes, researchers' online observations, students' online discourse, and group artifacts. The findings revealed interesting phenomena as results of cultural influences as well as educational system impacts. Students experienced learning benefits from PBL in the intensive six-week period, yet voiced serious concerns about the changed role of the instructor, as well as strong reservations on peer collaboration as a result of the competitive tradition in education. Online collaborative learning and PBL critically challenged some culturally-rooted traditions in Taiwan. The study generates practical insights into the applications of online collaborative learning and PBL in Taiwan's higher education as well as implications for cross-cultural implementation of online learning.