This is a study about emergence and development of the notion of ‘al-Adab al-Islami’ or Islamic Literature. The focus is on the conceptual thinking underlying Islamic Literature as a discourse. The term "Islamic Literature" consists of two fundamental components, "Islamic" and "Literature". In order to understand the concept of Islamic Literature, an appropriate understanding of the nature within Islam is inevitable. This study looks at the fundamental question whether Islamic Literature should give priority to its religious or its literary proper ties. This study observes the development of the concept of an Islamic Literature throughout the history. Islamic Literature draws its inspiration from the Quran and the Hadith, the sayings of the Prophet Muhammad