The official history of Buddhism in Japan began on October 13, B.E. 1095 (552 C.E.) when the ruler of Paekche or Kudara, one of the three kingdoms of ancient Korea, sent a delegation with an image of the Buddha to the emperor of Japan. Thirty-five years later, in B.E. 1130 (587 C.E.), one of the first Buddhist temples was built at Horyoji near Nara, which still stands as the oldest wooden building in the world.

In B.E. 1137 (594 C.E.) Prince Shotoku, who is regarded in Japan as 'the founder of Japanese civilization as well as of a united, Japanese nation' and in Japanese Buddhism as 'Asoka of the Land of the Rising Sun,' issued an Imperial Ordinance supporting and urging the development of the Three Treasures: the Buddha, the Dharma and the Sangha. By this Buddhism was established as the state religion of Japan. Then the Prince promulgated the first Japanese constitution, compiled the first history of Japan, lectured and wrote commentaries on Sutras, encouraged industries, transportation and communication, founded a religious centre, an orphanage, an old people's home and a hospital, and sent monks and students to the continent to study and bring back to Japan the arts and sciences and the highly developed culture of Buddhist China.

Nara Buddhism
Thus, in spite of its introduction through Korea, the further development of Buddhism in Japan went on through its close relationship with China. In B.E. 1253 (710 C.E.) Nara was established as the permanent capital. From this time to the end of the so-called Nara Period in B.E. 1326 (783 C.E.) six Buddhist sects, usually known as the Six Sects of the Nara Period, were introduced from China, namely, Sanron (the Madhyamika Three-Treatises), Kegon (the Avatamsaka), Hosso (the Yogacara), Ritsu (the Vinaya School), Jojitsu (the Satyasiddhisastra), and Kusha (the Abhidharmakosa). Only the first four of these sects were of importance, while the fifth was closely related to Sanron and the sixth could be regarded as part of Hosso. And it was the Hosso that was most influential.

Under Emperor Shomu of Nara, Japan saw the golden period of perfect peace when political unity was strengthened by the unity of faith in Buddhism and the ideal government was carried out in accordance with the ideal of the Dharma. The Daibutsu, the great image of the Maha Vairocana Buddha at the temple of Todaiji in Nara, erected in about B.E. 1286 (743 C.E.), is a symbol of this unity. At the ceremony dedicating this great image, the Emperor publicly declared himself the slave of the Three Treasures. His daughter, Empress Koken, even left the imperial throne for a time to live as a nun, devoting herself to the study and practice of Buddhism, and on coming again to the throne she appointed some priests as her ministers.

The Two Sects of the Heian Period
This strong support by the government and the growing influence of the monks and monasteries led to an undesirable result. A large number of people entered the monkhood only for gain and fame, and made the monkhood degenerate in moral virtues. The monks' involvement in politics made the situation even worse. This caused the downfall of the government at Nara. Then, to escape the influence of wealthy and politically powerful monks at the great Buddhist centres that had grown up around the court in Nara, the seat of the government was moved to Heian (later called Kyoto) in B.E. 1327 (784 C.E.). At the new capital, the Emperor issued Ordinances again and again to rouse the monks to noble virtues and proper conduct. This encouraged the rise of two new sects, Tendai and Shingon, which grew in influence and popularity till the end of the Heian Period in B.E. 1727 (1184 C.E.), while the six sects of Nara waned into obscurity. During this period the conciliation between Shinto and Buddhism was strengthened by turning ancient Shinto gods into Bodhisattvas. Then Buddhism ceased to be an imported religion and became nationalized as truly Japanese Buddhism. Thus Japan reached the classical age of its art, literature and religion.