As part of the reaction against Hinduism during its early years, Buddhism rejected the caste system and other forms of social stratification and instead set up an essentialy egalitarian society. There are only two religiously important social groups: the monks, who have dedicated their lives to full time pursuit of religious goals, and everyone else. The monks, as a group, are called the sangha (sometimes spelled samgha). The non-monks are referred to as the lay people, or, the laity, for short.
This distinction between the sangha and the laity provides the karmic "grease" that keeps the wheels of Buddhism running. The monks take a vow of poverty, renouncing the ownership of possessions. They receive their food through daily begging. The lay people accept this practice and give food to the monks, and support them in other ways. In this way, the lay people earn merit (good karma). In turn, the monks provide the laity with religious services, such as officiating at celebrations of birthdays and marriages, giving religious guidance, and so on. This earns the monks merit. As Buddhism spread and became popular, more wealthy people were attracted to it, including kings. Such people gave from their enormous resources, some building large and lavish monasteries, endowing food supplies, giving statues and other objects of precious metals, and so on.
The monastic movement is predominantly male. At the insistance of some of his early female followers, the Buddha established an order of nuns. The male monks are called Bhikkhu(s) and the female monks are called Bhikkhuni(s). The female monastic orders were never accepted as equals with the male. The nuns were required to follow the monastic rules for the monks, and then an additional set of rules designed for them alone. Ultimately, the female orders were allowed to die out, although they are being reestablished in modern times.
There are two main branches of Buddhism, and each branch has several further divisions. The first branch to form was Theravada, which means "Traditions of the Elders." It was essentially established by about 300 bce. This branch claims to follow only the teachings of Buddha, and to continue the organization that he established for society in general and for the sangha in particular. It is within Theravada that the main buddhist holy books, the tripitaka, were written down and the monastic rules (e.g., the Ten Precepts ) were propounded.
Theravada was strong in India and ultimately migrated to southeast Asia, first Sri Lanka, and then Thailand, Burma, Vietnam and other countries. Given the different cultures in these countries, Theravada changed and adapted to fit in each one, often adopting elements of the indigenous religions to help it establish a foundation.
Starting in the 100s bce, new books emerged called Sutras. These propounded new religious goals, with new ways of achieving them. Without violating the basic structures (social or doctrinal) of Buddhism, they created a new type of Buddhism that reshaped the older ways and provided new opportunities for both monks and lay persons in their attempts to achieve nirvana. This new form of Buddhism was called Mahayana, which means "The Great Vehicle." And just as a vehicle is a means of transportation, of moving towards a destination, so Mahayana claimed to provide new and "greater" means for reaching Buddhism's goal. To make the distinction clear, the followers of Mahayana called Theravada by the insulting term of "Hinayana," which means "The Little Vehicle."
If Theravada essentially remained in the south, Mahayana was spread into the north. It ultimately became an important religious force in China, Korea and Japan as well as in Mongolia, Tibet and other Himalayan countries. It began spreading in the first centuries bce/ce and ultimately reached Japan in the sixth century ce and the isolated Himalayan regions a couple centuries later.
Having once established the principle of creating new types of Buddhism, Mahayana became quite diversified. A number of different forms of Mahayana arose that developed and extended its doctrines and beliefs in different ways. The best known of these in the West are Zen Buddhism and Pure Land Buddhism, but there are many other forms, including Madhyamika (founded by Nagarjuna), Shingon, Tendai, and Nicheren. We will limit our discussion to Zen and Pure Land.
Starting in the eighth century ce, another branch of Mahayana begins, which is often
seen as a third branch of Buddhism, alongside Theravada and Mahayana. This Buddhism is
called Vajrayana, "The Diamond
Vehicle." It is also variously referred to as Tibetan Buddhism or as Tantrayana.
Vajrayana is a mix of Trantric ideas (as
in Hinduism) with Mahayana. After the key concepts are developed in northern India, it is
spread into Tibet and the Himalayan regions. When Buddhism then disappears from India,
Vajrayana remains isolated in the Himalayas and parts of Mongolia to develop on its own.