After having been captured in battle during the Arab-Muslim conquest of Persia, Abu Lu'lu'a was brought to Medina, the then-capital of the Rashidun Caliphate, which was normally off-limits to non-Arab captives.

When Umar refused to lift the tax, Abu Lu'lu'a attacked him while he was leading the congregational prayer in the mosque, stabbing him with a double-bladed dagger and leaving him mortally wounded.

From the 16th century onward this shrine became the focus of a yearly anti-Sunni festival celebrating Abu Lu'lu'a's assassination of Umar, whose reign Shi'ites consider to have been oppressive and unjust.

'the killing of Umar'), Abu Lu'lu'a received the nickname Bābā Shujāʿ al-Dīn (بابا شجاع الدين, 'Father Courageous of the Faith').

[7] A highly skilled joiner and blacksmith,[8] Abu Lu'lu'a was probably taken captive by his Arab master al-Mughira ibn Shu'ba in the Battle of Nahavand (642) and subsequently brought to Arabia, where he may also have converted to Islam.

[15] According to Wilferd Madelung in his The Succession to Muhammad, Umar's biased policies against non-Arabs may have played a prominent role in creating the climate which lead to the assassination.

Acting upon the claim of one man (either Abd al-Rahman ibn Awf or Abd al-Rahman ibn Abi Bakr) that they had been seen conspiring with Abu Lu'lu'a while he was holding the double-bladed dagger, Ubayd Allah also killed Hurmuzān (Umar's Persian military adviser), and Jufayna, a Christian man from al-Hira (Iraq) who had been taken to Medina to serve as a private tutor to a family in Medina.

Although Ubayd Allah may have been encouraged by his sister Hafsa bint Umar to avenge their father's death, his murder of Hurmuzān and Jufayna was likely the result of a mental breakdown rather than of a true conspiracy.

[28] According to Tayeb El-Hibri, the 9th-century historians who recorded these events (amongst others, Ibn Sa'd, al-Baladhuri, al-Tabari) regarded them as laying the first seeds of the special affinity between Persia and the Hashimid family of the prophet (including Ali), which would later be reflected in the crucial role played by Khurasani converts in overthrowing the Umayyads and establishing the Hashimid rule of the Abbasids during the Abbasid Revolution (750 CE).

[29] According to later legends, Abu Lu'lu'a did not die in Medina, but was miraculously saved from his pursuers by Ali, who transported him by means of a special prayer to Kashan (a city in central Iran), where he married and lived out the rest of his life.

[34] Recently, there has been some controversy over this sanctuary, with a number of Sunni institutions, such as the al-Azhar University and the International Union for Muslim Scholars, demanding the Iranian government demolish the shrine.

[44] During the Qajar period (1789–1925), the ritual cursing and humiliation of the first three caliphs was gradually abandoned due to the improving political relations with the Sunni Ottomans.

[49] It is a carnival-type of festival in which social roles are reversed and communal norms upturned,[50] generally functioning as a more lighthearted counterpart to the Ta'zieh passion plays commemorating the death of the prophet Muhammad's grandson Husayn ibn Ali at the Battle of Karbala in 680.