Chinese President Xi Jinping and Taiwan's President Ma Ying-jeou shook hands and smiled for photographers as they entered the hotel meeting room, APA reported citing BBC.
China views Taiwan as a breakaway province which will one day be reunited with the mainland.
But many Taiwanese see it as independent and are concerned at China's growing influence.
"Both sides should respect each other's values and way of life," Mr Ma said.
Mr Xi told the Taiwanese leader: "We are one family".
In the Taiwanese capital, Taipei, there were protests against the talks and one group tried to enter Taiwan's parliament building.
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