There are few early Islamic sources that can provide historians with any insights into the development of Kharijite political and religious ideology, especially in dialogue with other communities during the caliphate of Ali (35-40/656-661). Most narratives focus on two points with little connection between them: first, the Kharijite opposition to Ali’s rule because of the arbitration after the Battle of Siffin (37/657); and second, their defeat at the Battle of Nahrawan (38/659). However, the Nahj al-Balagha is an understudied resource when it comes to examining the Kharijite movement, its position, and its legitimacy vis-a-vis Ali’s responses in his orations and exhortations. In this paper, using theories of orality and early community development, I use the Nahj al-Balagha and other sources to trace a nuanced development of the Kharijites into a separate religious sect and political ideology. The Kharijite disagreement with Ali over Siffin is the start, not the end, of a politico-religious discourse; this discourse develops through Ali’s speeches to the Kufan community and his direct address of the Kharijites. By examining the speeches attributed to Ali before Nahrawan and re-situating them in a larger dialogue between Ali and dissidents in Kufa, integral parts of Kharijite development come to light. First, the development of their ideology takes place over time. It does not start at Siffin and end at Nahrawan, but rather, there is a constantly changing clash of religious and political reasoning. Second, the Kharijites are a community that develop within the bounds of Kufa, not without it—and thus, within the bounds of Ali’s rule, not without it. Their presence in Kufa means that Ali’s speeches to the Kufans are also directed to the Kharijites. Thus, and finally, it is possible to trace the development of early Kharijite thought through Ali’s responses and speeches to them and to the Kufan community in general; and it is impossible to realize early Kharijite development without examining their dialogue with Ali in Kufa.