Ting Wen-yin was kept out of the Miss Earth contest in Austria because she refused to compete for "Chinese Taipei" - the name by which Beijing insists the self-ruled island should be known.
Ting, 22, said pageant organisers had initially given her a "Taiwan ROC" sash - short for "Republic of China", the territory's preferred name - but later said there had been a mistake.
When she declined to wear the replacement ribbon, she was told to "just leave" and barred from the stage over the weekend.
"It seems some department from China had reported it, then the organisers told me to replace it with Chinese Taipei at the evening event," Ting wrote on Facebook.
Taiwan and China separated in 1949 after a civil war, and despite more than six decades of self-rule, Beijing insists the island is a renegade province awaiting reunification.
Both governments insist they are the legitimate rulers of greater China.
Taiwan participates in international events as Chinese Taipei, the name of its capital, instead of Republic of China (ROC) to skirt mainland sensitiveness.
Ting said her stance stemmed from not wanting her home to be "humiliated", at a time when Taiwanese are growing wary of expanding Chinese influence.
"On the map, Taiwan is Taiwan. All the nations enter using their country names, while we use the name of a city," said Ting.
Taiwanese foreign ministry spokeswoman Eleanor Wang said in a statement the "Chinese Taipei" sash had been replaced because of pressure from China.
The Miss Earth pageant - whose finals are on December 5 - bills itself as an event promoting environmental awareness, and says the winner serves as an ambassador for campaigns.
The furore comes just weeks after a historic summit between Taiwanese President Ma Ying-jeou and Chinese leader Xi Jinping in Singapore, the first meeting between leaders since the 1949 split.
It also comes after Canada's Chinese-born Miss World contestant claimed she was being denied a visa to compete in this year's finals in China because of her criticism of Beijing's human rights record.