Islamic State of Iraq traces its origins to Jama'at al-Tawhid wal-Jihad (JTJ) group, which was formed by the Jordanian national Abu Musab al-Zarqawi in Jordan in 1999.

On 7 April 2013, Abu Bakr al-Baghdadi re-designated ISI as the "Islamic State of Iraq and the Levant" (ISIL), officially announcing the group's formal expansion into Syria and its intention to absorb the Al-Nusra Front thereby taking direct command over its fighters and territory.

[19] Jordanian militant Abu Musab al-Zarqawi started a group called Jama'at al-Tawhid wal-Jihad (Organization of Monotheism and Jihad) in 1999, aiming to overthrow the 'apostate' Kingdom of Jordan.

[23] Urging all Muslims in Iraq to give bay'ah to Abu Omar al-Baghdadi, the declaration stated: “And today we call on all Iraqi mujahideen, scholars and tribal sheikhs.

And the general Sunnis; To pledge allegiance to the Commander of the Faithful, the honorable Sheikh Abu Omar al-Baghdadi, to listen and obey in times of action or hatred, and to work hard to strengthen the foundations of this state and to sacrifice life and treasure for it.”[24]Between 2003 and 2004, targets of the "Jama'at al-Tawhid wal-Jihad" group had included the assets of the US-led Multi-National Force in Iraq and the U.S.-installed Iraqi provisional government.

After the establishment of ISI, the organization's first Emir Abu Omar al-Baghdadi stated in 2006:"[We have] reached the end of a stage of jihad and the start of a new one, in which we lay the first cornerstone of the Islamic Caliphate project and revive the glory of religion.

[22][28] The US government initially viewed Abu Omar al-Baghdadi as a fictitious persona, invented to put an Iraqi face on the leadership of ISI which the US saw as a front organization of the global Al-Qaeda network.

[43] Between 2005 and 2010, according to an analysis by RAND Corporation of 200 documents—personal letters, expense reports and membership rosters—captured by US Forces between 2005 and 2010, 95% of the group's budget was raised in Iraq, from the oil business, kidnappings, extortion, cash of members from Mosul, etc.

[44] In 2006, Iraqis effectively ran Al Qaeda in Iraq (AQI) in positions like internal security and battalion commanders, with foreign fighters' often relegated to suicide attackers, however the upper tiers of the organization were still dominated by non-Iraqis.

[45] AQI was a well-oiled and bureaucratic organisation with a high degree of documentation of its activities, from records of payments to its members, lists of opponents to be killed, and verdicts and sentences given to its prisoners.

In 2008, Islamic State of Iraq appeared to have at least 80 execution videos, mostly beheadings, lying on the shelf that had never been distributed or released on the Internet: a former AQI commander told CNN that they were used to verify the deaths to their superiors and to justify continued funding and support.

By August 2006, AQI had emerged the dominant power in Anbar region and a U.S. military report described Al-Qaeda as an "integral part of the social fabric of western Iraq".

The 23 March 2007 assassination attempt on Sunni Deputy Prime Minister of Iraq Salam al-Zaubai was claimed by ISI: "We tell the traitors of al-Maliki's infidel government, wait for what will destroy you".

[71] In a 42-minute audiotape released on 17 April, Abu Omar al-Baghdadi responded: "To my sons of the Islamic Army (…) We swear to you we don't shed the protected blood of Muslims intentionally", and, calling for unity: "One group is essential to accomplish victory".

[76] Observers and scholars (like US Middle East specialist Steven Simon,[76] US terrorism analyst Lydia Khalil,[76] and Anthony H. Cordesman of the US Center for Strategic and International Studies[77]) asserted that the role played by 'AQI' was being unduly stressed.

[67] By December 2007, the so-called "Awakening movement", an Arab tribal force in the Anbar region paid by the American military to fight ISI, had grown to 65,000–80,000 fighters.

The U.S. intelligence report concluded that MNF-I coalition forces lacked the ability to impede the expansion of the AQ-led insurgency in northern Iraq without a massive American troop surge.

According to US Colonel Donald Bacon, 19 senior operatives of Islamic State of Iraq were killed or captured by US and Iraqi Security Forces in July; 25 in August; 29 in September; and 45 in October.

By May 2008, according to Newsweek, US and Iraqi military offensives had driven AQI from Al Anbar and Diyala Provinces, leaving ISI holed up in and around the northern city of Mosul.

[87] After the Iraqi provincial elections in January 2009, Islamic State of Iraq offered an olive branch to other Sunni insurgent groups, and even extended "a hand of forgiveness" to those who had worked with the Americans.

[90] On 19 August 2009, three car bombs exploded in Baghdad, targeting the Iraqi Finance and Foreign Ministries, a hotel and a commercial district, killing 101 and injuring 563 people.

[95] He built a management structure of mostly middle-aged, Hussein-era Iraqi officers overseeing the group's departments of finance, arms, local governance, military operations and recruitment.

[98] On 31 October 2010, members of ISI attacked Our Lady of Salvation Syrian Catholic church in Baghdad—purportedly in revenge for an American Christian burning of the Qur'an that had not actually happened yet.

Golani was part of a small group of ISI operatives who crossed into Syria, and reached out to cells of militant Islamists who had been released from Syrian military prisons in May–June 2011 and were already fighting an insurgency against Assad's security forces.

[110][111] On 22 July 2012, Al-Baghdadi released a 33-minute speech, mostly devoted to the Syrian uprising or civil war: "Our people there have fired the coup de grace at the terror that grasped the nation [Syria] for decades … and taught the world lessons of courage and jihad and proved that injustice could only be removed by force", he said.

[118] In a video released on April 7, 2013, Abu Bakr al-Baghdadi announced the renaming of ISI as the "Islamic State of Iraq and the Levant" (ISIL), signaling the group's expansion into Syria and its intention to forcibly absorb the Al-Nusra Front.

[119][19] Demanding the dissolution of ISIL, Al-Zawahiri wrote:“Sheikh Abou Bakr Al-Baghdadi was wrong when he announced the Islamic State in Iraq and the Levant without asking permission or receiving advice from us and even without notifying us.

The seat of Jabhat Al-Nusra for the people of Al-Sham is in Syria.”[119]Abu Bakr al-Baghdadi publicly rejected the proposals of Ayman al-Zawahiri, marking a turning point in AQ-ISIL relations.

[17][120] According to a report released by Al-Jazeera in June 2013, a source from the Al-Nusra Front described the emerging AQ-ISIL conflict as “the most dangerous development in the history of global jihad”.

[130] On 29 June 2014, ISIL announced its name change to the "Islamic State" and declared the establishment of a "Caliphate", aiming to rule Iraq, Syria, as well as the entire Muslim world.