The present study proposes an improved conceptual model for the hydrothermal system in the Tatun Volcano Group in northern Taiwan. In the study, audio-magnetotellurics (AMT) surveys were conducted to reveal the spatial distribution of resistivity, which is highly sensitive to fluids and hydrothermal alteration. By combining the obtained resistivity structure with other geophysical and geochemical evidence, the following hydrothermal system was inferred. Beneath Chishinshan, vapor-dominant hydrothermal fluids, supplied from a deeper part, are maintained in a low to relatively low resistivity region (5 to 20 Ω m) that is covered by a clay-rich cap, represented by an upper extremely low resistivity layer. Fluid ascent is suggested by a pressure source and clustered seismicity. Exsolved gases result in fumarolic areas, such as Siao-you-keng, while mixing of gases with shallow groundwater forms a shallow flow system of hydrothermal fluids in the Matsao area, represented by a region of less than 10 Ω m. The fumarole in the Da-you-keng area originates from vapor-dominant hydrothermal fluids that may be supplied from a deeper part beneath Cing-tian-gang, suggested by a pressure source and low to relatively low resistivity. Horizontally extended vapor-bearing regions also suggest the possibility of future phreatic eruptions. The proposed conceptual model may provide clues to detecting precursors of potential volcanic activity.