Excerpts from Books and Wikipedia
"Ali, Muhammad's cousin and son-in-law, became caliph in 656, after the murder of Caliph Uthman. . . . He soon faced a rebellion by Uthman's cousin, Muawiya, who was outraged by Ali's refusal to punish his kinsman's murderers. For the first time, Muslims fought Muslims. Kharijite members, who rejected the caliphate as an institution, plotted to murder both Ali and Muawiya. But they killed only Ali, leaving Muawiya to become caliph, his followers becoming Sunnis, from the Arabic word Sunnah (example of the Prophet). Ali's supporters became loyal to his son Hasan, causing a permanent breach in Islam." [1001 Days]
"In that highly contested succession lie the origins of many of the major shapes and terms of Islam that are mostly unknown or puzzling to non-Muslims: Shiites and Sunnis, caliphs and emirs, Umayyads and Abbasids, all of these crucial internal divisions. . . . But Ali ruled a mere five years before his caliphate came to a bloody end with his assassination in 661." [Menocal: Ornament of the World, p. 18-9]