In 1894, he fell victim to a judicial conspiracy that sparked a major political crisis during the Third Republic, known as the Dreyfus Affair (1894–1906), when he was wrongfully accused and convicted, due to antisemitism, of being a spy for the German Empire.

Alfred Dreyfus's life and the persecutions he endured because he was Jewish left a significant mark on French political consciousness; the true culprit, Ferdinand Walsin Esterhazy, remained unpunished.

Among Dreyfus’s defenders were writers such as Émile Zola, Charles Péguy, and Anatole France, politicians like Georges Clemenceau and Jean Jaurès, and the founders of the Human Rights League (LDH) Francis de Pressensé and Pierre Quillard.

Two years later, he graduated ninth in his class with honourable mention and was immediately designated as a trainee in the French Army's General Staff headquarters, where he would be the only Jewish officer.

However, one of the members of the panel, General Bonnefond, felt that "Jews were not desired" on the staff, and gave Dreyfus poor marks for cote d'amour (French slang: attraction; translatable as likability).

Learning of this injustice, the two officers lodged a protest with the director of the school, General Lebelin de Dionne, who expressed his regret for what had occurred, but said he was powerless to take any steps in the matter.

[3]: 84 A torn-up handwritten note, referred to throughout the affair as the bordereau, was found by a French housekeeper, a woman named Marie Bastian, in a wastebasket at the German Embassy.

Bastian, whose job was to burn the waste of Maximilian von Schwartzkoppen, instead sent it to Hubert-Joseph Henry for potential interest to French intelligence.

In 1894, this made the French Army's counter-intelligence section, led by Lieutenant Colonel Jean Sandherr, aware that information regarding new artillery parts was being passed to Maximilian von Schwartzkoppen, the German military attache in Paris, by a highly placed spy most likely on the General Staff.

On 5 January 1895, Dreyfus was summarily convicted in a secret court martial, publicly stripped of his army rank, and sentenced to life imprisonment on Devil's Island in French Guiana.

"[3]: 113 In August 1896, the new chief of French military intelligence, Lieutenant Colonel Georges Picquart, reported to his superiors that he had found evidence to the effect that the real traitor was the Major Ferdinand Walsin Esterhazy.

When reports of an army cover-up and Dreyfus' possible innocence were leaked to the press, a heated debate ensued about antisemitism and France's identity as a Catholic nation or a republic founded on equal rights for all citizens.

She wrote about her interviews in September 1898,[5] reporting his confession and writing a leader column accusing the French military of antisemitism and calling for a retrial for Dreyfus.

[6] In France there was a passionate campaign by Dreyfus' supporters, including leading artists and intellectuals such as Émile Zola,[7] following which he was given a second trial in 1899, but again declared guilty of treason despite the evidence of his innocence.

However, due to public opinion, Dreyfus was offered and accepted a pardon by President Émile Loubet in 1899 and released from prison; this was a compromise that saved face for the military's mistake.

While attending a ceremony relocating Zola's ashes to the Panthéon on 4 June 1908, Dreyfus was wounded in the arm by a gunshot from a right-wing journalist, Louis Grégori [fr], who was trying to assassinate him.

[11] In October 2021, French president Emmanuel Macron opened a museum dedicated to the Dreyfus affair in Médan in the northwestern suburbs of Paris.

During the German occupation of France during WWII, Lucie Dreyfus, who had played a major role in the fight to exonerate her husband, was hidden in a convent in Valence.

Their daughter, Jeanne Dreyfus Lévy (1893–1981), also survived, but granddaughter Madeleine Levy, arrested by French police in Toulouse, was deported and died of typhus in Auschwitz in January 1944, aged 25.

[3]: 352 Dreyfus' grandchildren donated over three thousand documents to the Musée d'Art et d'Histoire du Judaïsme (Museum of Jewish Art and History), including personal letters, photographs of the trial, legal documents, writings by Dreyfus during his time in prison, personal family photographs, and his officer stripes that had been ripped off as a symbol of treason.