Timber is one of the most common materials used in traditional buildings worldwide. Our previous research has suggested that timber shear walls play an important role in resisting external loadings, such as earthquakes. Thus, improving the structural performance of in-filled shear walls can also improve that of the entire structure. In the traditional Taiwanese timber shear wall system, the embedment strength of beams and friction between wooden planks and beams significantly affect the strength of the shear wall. This article proposes a new method of reinforcing traditional timber shear walls in Taiwan by inserting teak and padauk strips into the grooves between wooden planks and beams to increase the embedment strength of beams and the friction between wooden planks and the hardwood strips. A total of 18 full-scale specimens were tested under reversed cyclic loading. The results revealed that the strength and energy dissipation capacities of a wooden shear wall can be significantly increased by inserting teak and padauk strips into the grooves between planks and beams. Furthermore, the simplified calculation method proposed in this study can be used to calculate the strength of both reinforced and unreinforced wooden shear walls with satisfactory agreement.