Taejo began his career in the turbulent Later Three Kingdoms period (후삼국 시대; 後三國時代). In the later years of Silla, many local leaders and bandits rebelled against the rule of Queen Jinsung, who did not have strong leadership or policy to improve the condition of the people. Among those rebels, Gung Ye (궁예; 弓裔) of northwestern region and Gyeon Hwon (견훤; 甄萱) of southwest gained more power. They defeated and absorbed much of the other rebellion groups as their troops marched against local Silla officials and bandits. In 895, Gung Ye led his forces into the far northwestern part of Silla, where Songdo was located. Wang Yung, along with many other local clans, quickly surrendered to Gung Ye. Wang Geon followed his father into service under Gung Ye, the future leader of Taebong, and he began his service under Gungye's command.

Wang Geon's ability as a military commander was soon recognized by Gung Ye, who promoted him to general and even regarded him as his brother. In 900, he led a successful campaign against local clans and the army of Later Baekje in Chungju area, gaining more fame and recognition from the king. In 903, he led a famous naval campaign against the southwestern coastline of Hubaekje, while Gyeon Hwon was at war against Silla. He led several more military campaigns, and also helped conquered people who lived in poverty under Silla rule. The public favored him due to his leadership and generosity.

In 913, he was appointed as prime minister of the newly renamed Taebong. Its king, Gung Ye, whose leadership helped in the foundation of the kingdom but began to refer to himself as the Buddha, began to persecute people who expressed their opposition against his religious arguments. He executed many monks, then later even his own wife and two sons, and the public began to turn away from him. His costly rituals and harsh rule caused even more opposition.

In 918, four top-ranked generals of Taebong — Hong Yu (홍유; 洪儒), Bae Hyeongyeong (배현경; 裵玄慶), Shin Sung-gyeom (신숭겸; 申崇謙) and Bok Jigyeom (복지겸; 卜智謙) — met secretly and agreed to overthrow Gungye's rule and crown Wang Geon as their new king. Wang Geon first opposed the idea but later agreed to their plan. The same year Gung Ye was overthrown and killed near the capital, Cheorwon. When Gung Ye was assassinated in 918, the generals installed Wang Geon as the new king of this short lived state. He was crowned king and renamed the kingdom Goryeo, thus beginning the Goryeo Dynasty. The next year he moved the capital back to his hometown, Gaegyeong.

He promoted Buddhism as Goryeo's national religion, and called for the reconquest of the northern parts of Korea and Manchuria, which were controlled by Balhae. Balhae's rule over vast regions of Manchuria and parts of Siberia were overthrown by the Khitan invasion in 926, and the majority of its people came to Goryeo as refugees led by Balhae's last Crown Prince Dae Gwang-hyeon. Taejo accepted them as his citizens, since Balhae and Goryeo came from common ancestry (Goguryeo), and captured the old, then abandoned, capital city of Goguryeo, P'yŏngyang. He also sought an alliance and the cooperation of local clans rather than trying to conquer and bring them under his direct control.

In 927, Gyeon Hwon of Hubaekje led forces into Silla's capital, Gyeongju, capturing and executing its king, King Gyeongae. Then he established King Gyeongsun as his puppet monarch before he turned his army toward Goryeo. Hearing of the news, Taejo planned a strike with 5000 cavalrymen to attack Gyeon's troops on the way back home at Gongsan near Daegu. He met Hubaekje forces and suffered a disastrous defeat, losing most of his army including his generals Kim Nak and Shin Sunggyeom, the very same man who crowned Wang as a king. However, Goryeo quickly recovered from defeat and successfully defended Hubaekje's attack on its front.

In 935, the last king of Silla, King Gyeongsun, felt there was no way to revive his kingdom and surrendered his entire land to Taejo. Taejo gladly accepted his surrender and gave him the title of prince, and accepted his daughter as one of his wives (Wang had six queens, and many more wives as he married daughters of every single local leader). It caused much disgust to Gyeon Hwon. Gyeon's father, who held his own claim of Sangju region, also defected and surrendered to Goryeo and was received as the father of an emperor.

In the same year, Gyeon Hwon's oldest son, Singeom (신검; 神劍), led a coup with his brothers Yanggeom and Yonggeom, against their father, who favored their half - brother, Geumgang, as his successor to the throne. Gyeon Hwon was sent into exile and imprisoned in a Buddhist temple (Geumsan Temple), but escaped to Goryeo and was treated like Taejo's father, who died just before his surrender.

In 936, Wang led his final campaign against Singeom of Later Baekje. Singeom fought against Taejo, but facing much disadvantage and inner conflict, he surrendered to Taejo. Wang finally occupied Hubaekje formally, and unified the nation for the first time since Gojoseon; he ruled until 943, and died from disease.

Taejo sought to bring even his enemies into his ruling coalition. He gave titles and land to rulers and nobles from the various countries he had defeated: Later Baekje, Silla, and also Balhae, which disintegrated around the same time. Thus he sought to secure stability and unity for his kingdom which had been lacking in the later years of Silla.

The unification of the Later Three Kingdoms in 936 CE was very important in Korean history; the unification of 668 CE by Silla was only a unification of approximately half of the peoples of the Korean Peninsula and its vicinity (who at the time largely considered themselves one people divided among many states), since the northern part was ruled by Balhae, which asserted itself as a reincarnation of Goguryeo. However, Wang Geon's unification in 936 was a more complete unification (in which only a single state emerged among the people, as opposed to the 7th century CE, when two, Unified Silla and Balhae, emerged); the people of the Korean Peninsula thereafter remained under a single, unified state (even when changing dynasties, to the Joseon Dynasty, in 1392 CE) until 1948, when Korea was divided into north and south by Russian and U.S occupation forces.

The modern name of "Korea" is derived from the name "Goryeo," which itself is derived from "Goguryeo," to whose heritage (and by extension, territory) Wang Geon and his new kingdom laid claim. As the first ruler to more fully unite the people of the Korean Peninsula under a single state, many modern day Koreans look to his example for applicability to the current state of division on the Korean Peninsula.

During the Goryeo dynasty, 태자 or crown prince didn't mean heir to the throne. It was a kind of peerage title which was given to sons of emperor. 정윤 or Jung-yun was the title for heirs to the throne.