The word actually means 'party'; it became the name of the supporters of Ali ibn Abi Talib - cousin and son in law of Muhammad - whom they championed to be his successor as Khalifa/Successor. They were less interested in the Caliphate and more in the Imamate.
They believed that the Caliph/ Successor to Muhammad had to be from the
'House of Muhammad' / Ahl al Baiyt.
Ali who was allegedly nominated to that office by Muhammad on the basis of a divine ordinance. They also believed that his descendants were pre ordained to follow him in this highest of offices, by Allah.
In fact Shiism was born on the 10th of Muharram 680, at the death of al Hussein. From that moment in history forwards, the schism in Muhammadan Islam became permanent, deadly, divisive and irreconcilable. The Shiites themselves are split up into a large number of sects with irreconcilable 'points of view' the most important one is the 'Twelvers' or Imamates.
They and Mu'awiya's supporters went into a civil war over this succession. The Hadith tradition of the Shi'a is markedly different from that of the Sunnis for obvious political, doctrinal and theological reasons and interpretations.
Because of internal disagreements and dissention, many of the earlier records of Shi'a Islam have been destroyed and the very few that have survived cannot be trusted or are not fully reliable. The earliest sources in existence that give us information on the doctrinal stance of the Shi'a are not earlier than the tenth century. Off shoots of the Shi'a sect are the Druze, Isma'ilis and Zaydis.
After Ali was murdered by a Kharijite in 661CE, his son Hassan resigned his claim to the Caliphate allowing Mu'awiya to be proclaimed Caliph at Jerusalem in the same year.
Hassan's brother, Hussein, came out in rebellion against Yazid, Mu'awiya's son. In a battle near Karbala,Iraq, he and his entourage of about 200 people were massacred and his head sent to Yazid in Damascus.
Among the Shi'a doctrines is their rejection of the principle of the consensus of the community and replaced it with the doctrine of an infallible Imam in every age to whom alone Allah reveals His guidance. The Shi'a must henceforth believe in all the Imams especially the Imam of their own time who is the divinely appointed - of course elected by other mortal Imams under the guidance of Allah- teacher and ruler of the faithful.This belief is of course contrary to the secular teachings of Muhammad since it is almost identical to the Catholic concept of the Papacy.
Although this was an Arab movement that started in the Arabian Peninsula, it was later taken over by the Mawali - none Arab Muhammdans - who became the majority among the followers of Muhammad in the conquered territories of Iraq and Persia.
Their strongest and most numerous groups were in Khurasan, Persia. In 750 CE, on the banks of the river Zab,Ibrahim bin Abu'l Abbas defeated and destroyed the Ummayad army and became Khalifa.
The Shi'a take a very strict view of ritual purity to the extent that they consider both the Christians and Jews as Najis/Unclean and they would not eat or drink from vessels that they have used.
In the world today, they represent less than 15% of the followers of Muhammad and their only truly Shi'i state is Persia/Iran.