The Shia believe that after Prophet Muhammad's death, his son-in-law, Ali, should have been given the reins of administration. They still regard him as the first imam or spiritual leader.

The Sunni, however, believe that the appointment of one of the Prophet's companions, Abu Bakr, as the first caliph was correct.
The Sunnis also respect Ali as the fourth Caliph of Islam.

See : The early Caliphs

The Great Schism
In AD 661, Ali was murdered and his chief opponent, Mo'awiya, became Caliph. It was the death of Ali that led to the great schism between Sunnis and Shias.

Mo'awiya laid the foundation of family rule in Islam and he was later succeeded by his son, Yazid. But Ali's son Husayn refused to accept his legitimacy, and fighting followed. Husayn and his followers were massacred in Battle in Karbala in AD 680.

The deaths of both Ali and Husayn gave rise to the Shia characteristics of martyrdom and a sense of betrayal. Even today, Shia all over the world commemorate the killing of Husayn with vast processions of mourning in Iran and other parts of the Muslim world.

'Messianic faith'
Shia Islam has always been the rigid faith of the poor and oppressed, of those waiting for deliverance. It is seen as a messianic faith - awaiting the coming of the 'hidden imam', Allah's messenger, who will reverse their fortunes and herald the reign of divine justice.

Today, the Shia make up about 15% of the total worldwide Muslim population. The Shia are a majority in Iran (89%) and in Iraq (60%).