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Abstract Magic-angle twisted bilayer graphene has recently become a thriving material platform realizing correlated electron phenomena taking place within its topological flat bands. Several numerical and analytical methods have been applied to understand the correlated phases therein, revealing some similarity with the quantum Hall physics. In this work, we provide a Mott-Hubbard perspective for the TBG system. Employing the large-scale density matrix renormalization group on the lattice model containing the projected Coulomb interactions only, we identify a first-order quantum phase transition between the insulating stripe phase and the quantum anomalous Hall state with the Chern number of ±1. Our results not only shed light on the mechanism of the quantum anomalous Hall state discovered at three-quarters filling, but also provide an example of the topological Mott insulator, i.e., the quantum anomalous Hall state in the strong coupling limit.