Tsai held a hastily arranged news conference on Monday, after the Solomon Islands made a decision to establish ties with China.
The move came after the Solomon Islands' months-long review of the pros and cons of a switch to Beijing, which was offering US$8.5 million in development funds to replace support from Taiwan.
"It is absolutely evident that China, through this case, deliberately seeks to influence Taiwan's upcoming presidential and legislative elections", Minister of Foreign Affairs Joseph Wu (吳釗燮) told a news conference at 6:30pm.
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"Beijing's objective is to diminish Taiwan's worldwide presence, hurt the Taiwanese people, and gradually suppress and eliminate Taiwan's sovereignty", it said.
"I want to emphasize that Taiwan will not engage in dollar diplomacy with China in order to satisfy unreasonable demands", she said.
China's Foreign Ministry did not immediately comment on Monday, nor did the most authoritative state mouthpieces. "The government strongly condemns this and urges people to hold on to its sovereignty and the value of freedom and democracy", Wu said.
It vowed to fight China's "increasingly out of control" behavior after El Salvador past year switched its allegiance to Beijing.
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China has stepped up its efforts to diplomatically squeeze Taiwan internationally since Tsai of the independence-leaning Democratic Progressive Party assumed office in May 2016.
Taipei, Taiwan. The island democracy of 23 million people elected President Tsai Ing-wen, who is bitterly opposed by the Communist government in Beijing. "China will never succeed in its attempt to sway Taiwan politics and elections".
Most countries in the world recognize Beijing as the government of China, and China has been wooing the remaining ones to abandon Taiwan. The prime minister's office did not immediately respond to questions.
The severing of ties on Monday leaves Taiwan with only 16 diplomatic allies.
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The decision marks a blow for Taiwan, as the South Pacific has always been considered a stronghold in its diplomatic battle with China.