This dissertation constructs and analyzes a theory for why Islamic religious leaders choose to form political parties in some Muslim-majority countries, but not others. It particularly focuses on the choice of prominent Islamic leaders either to engage directly in the political process through party formation or to operate as powerful non-partisan interest group players. I argue that Islamic parties form when the country's initial electoral transition is dominated by an authoritarian power and when the country has historic examples of indigenous Islamic rule. The former point is important for two reasons. First, Islamic leaders are more likely to form parties when there is limited space for civil society so as to secure a degree of influence in the political process. Second, because of the lack of space for civil society, Islamic leaders are often the only ones with a strong grassroots network since social and political life in mosques is generally less constrained than in other parts of civil society, so Islamic leaders often feel an obligation (and see an opportunity) to organize a strong opposition party. A history of Islamic rule' by which I mean having an indigenous government led by Islamic religious leaders or governed under Islamic law' is important because it provides Islamic leaders with a historical precedent to legitimate Islamic party formation. I also examine the role of anti-Islamic regime behavior in motivating the Islamic opposition. While my research concurs with the literature that anti-Islamic regime behavior plays an important role in pushing Islamic leaders to mobilize opposition, I show that this opposition does not directly lead them to form political parties. Finally, I keep the role of individual political agency at the center of my analysis throughout. My theory draws on the existing literature and on my process tracing of the cases of Algeria and Mali, as well as on field research conducted in Egypt, Mali and Senegal. I conclude the project by carrying out a comparative historical analysis of a larger sample of Muslim-majority countries to analyze the theory's plausibility, demonstrating that the theory applies across a broad sample of cases.