The call from Lenin to the 'international Communists' to break from the 'social traitors' and form Communist parties found an echo across the world, including in Britain. While thousands of people were inspired by the example of the first workers’ state established by the 1917 Bolshevik revolution, the left in Britain was even more divided than it sometimes appears to be today.

Since the highpoint of militant political struggle around the Chartists in the 1830s and '40s, revolutionaries had failed to connect in any significant way to the new working class created by intense industrialisation and the supremacy of British capital. From the late 1880s and early '90s, an upsurge of militancy among the unskilled and semi-skilled workers of the 'New Unionism' had swollen the ranks of the Marxist-oriented Social Democratic Federation. The SDF carried this revolutionary tradition into the British Socialist Party in 1911.
  Many workers, especially women, joined trade unions during the huge wave of strikes from 1910-13, although more working class men continued to vote Liberal rather than for the fledgling Labour Party and its more left-wing affiliate, Keir Hardie's Independent Labour Party.

But old loyalties began to shift profoundly during and immediately after the 1914-18 Great War between the main imperialist powers. Millions of workers were slaughtered in the trenches in the name of 'patriotism', empire, the rights of small nations and even 'a war to end all wars'. In reality, they had died needlessly in a predatory struggle between the capitalist ruling classes of each country. It was a case of thieves and exploiters falling out with each other, each group seeking to re-divide the world's colonial territories to their own advantage.
  During the war, more and more sections of industrial workers—Yorkshire and Lancashire engineers, Clydeside munitions workers, south Wales coal miners—organised and took action to defend their rights and living standards. Most trade union and Labour Party leaders chose instead to support the war effort. In Britain as elsewhere, the majority of 'socialist' and social-democratic party leaders lined up behind their 'own' ruling class, betraying pre-war pledges by the Socialist International to oppose the warmongering governments.

But the Russian Bolsheviks showed how imperialist war and carnage could be turned into civil war and revolutionary victory. After the Great October Socialist Revolution of 1917, Soviet Russia withdrew from the bloodbath, only to face White counter-revolutionary terror and, soon afterwards, the intervention of 14 foreign armies including forces from Britain, the USA, Poland and Japan. 

Many workers were profoundly inspired by the example of the Bolsheviks. Harry Pollitt, then working in a small workshop in Lancashire and later Communist Party general secretary, said that his first thoughts were: 'The workers have done it at last ... lads like me had whacked the bosses and the landlords, had taken their factories, their lands and their banks'.

In this spirit, socialists formed the great 'Hands Off Russia!' movement which spread through Britain to defend the world's first socialist state when twelve imperialist states invaded to, as Winston Churchill put it, “strangle the socialist baby at birth.” The movement drew together a younger generation of militant workers such as Pollitt, alongside older stalwarts like Tom Mann. The campaign received a massive boost on May 10, 1920, when London Dockers refused to coal the Jolly George, a ship loaded with arms which were bound for the Soviet Republic.

Therefore, the call for the formation of Communist parties across the globe was seized upon by militant workers, socialists and working-class organisations in Britain. After months of difficult negotiations, the first Communist Unity Convention was held in London on July 31 and August 1, 1920, attended by delegates from the British Socialist Party, the Communist Unity Group (expelled members of the Socialist Labour Party), the South Wales Communist Council and other socialist and shop stewards' organisations.

The delegates were united by deep revolutionary feelings, a profound hatred of capitalism and utter disgust at the repeated betrayal of workers' interests by corrupt reformist leaders. Yet they also had different approaches to solving the problems of the working class, reflecting their different backgrounds, experiences and group loyalties. There was complete agreement on the basic aim of establishing working class political power through Workers' Councils, with the dictatorship of the proletariat as 'the necessary means for combating the counter-revolution during the transition period between capitalism and Communism'.

But there was vigorous debate and disagreement on whether the infant Communist Party of Great Britain should participate in bourgeois elections, and on what its attitude should be to the Labour Party and the official trade union movement. The British Socialist Party had been affiliated to the Labour Party, which then more clearly fulfilled its role—proclaimed upon the party's foundation in 1906—as the parliamentary expression of the whole labour movement. Consequently, many Communist Unity Convention delegates favoured affiliation to the Labour Party as a way forward for the new Communist Party.

Other delegates expressed the contrary view, born of their own experiences, that parliamentary politics were a diversion and that the Party should concentrate on rank and file industrial struggle.

The majority of delegates supported the views of Lenin expressed at the Communist International (founded in 1919) and in his letter of greetings to the Unity Convention, where he advocated 'participation in Parliament, and affiliation to the Labour Party on condition of free and independent Communist activity'. In speeches at the Comintern congress and in talks with leading Communists such as Willie Gallacher, Sylvia Pankhurst and William Paul, Lenin rejected fears that Britain's Communists might become infected with careerist and conformist parliamentarianism, arguing that the party had to develop a new type of flexible yet incorruptible approach to parliamentary work.

It was decided by the founding convention of the CP to take part in electoral work and to affiliate to the Communist International. But delegates had not been anywhere near unanimous in their decision to seek Labour Party affiliation, which was only carried by 100 votes to 85 votes. The nature of the Communist Party’s relationship with Labour would continue to be a major issue of debate throughout the Party’s history.

In January 1921, at a conference in Leeds, Communist unity took a second major step forward when the CP merged with the Sylvia Pankhurst's Communist Party (formerly the Women's then the Workers' Socialist Federation) and the Communist Labour Party (recently established in Scotland by sections of the shop stewards movement).

The unified CP set itself the formidable task of offering leadership to the working class in what was then still the world's dominant imperialist power, presided over by the most experienced—and ruthless—ruling class. Moreover, in the world's oldest and most industrialised economy, this was a working class whose labour movement was dominated by the ideology of class collaboration.

Britain's Communists immediately went into action to mobilise workers against another, much bigger military invasion of Soviet Russia, proclaiming the slogan 'Not a Man, Not a Gun, Not a Penny'. In response to the Communist Party's manifesto and a call from the Labour Party—both carried in the Daily Herald—protest meetings were held across England, Scotland and Wales and 350 Councils of Action were set up.

The campaign forced Lloyd George's Tory-Liberal coalition government to retreat on the pretext that war had never been intended. It was a momentous victory, showing what could be achieved by united working class action.

Getting that lesson understood, organising militant struggle and turning the labour movement away from right-wing influence was the vital task taken on by the newly-established Communist Party. The growth of unemployment in the economic crisis of the early 1920s encouraged the bosses in their offensive for wage cuts. The disastrous class collaboration policy that dominated the leadership of the trade unions led to defeat in the miners in 1921, the engineers' lockout in 1922 and in the Dockers' six-week strike in 1923.

In response to the return of mass unemployment, Communists took the lead in forming the National Unemployed Workers' Movement, led by Wal Hannington. 

It was the also the Communists who raised the slogan 'Stop the Retreat'. The Labour Party leadership's inability or unwillingness to challenge the capitalists consistently in the class struggle—politically and ideologically—lay behind its rejection of Communist Party affiliation. As Communist influence grew in the trade union movement and among shop stewards, Party militants and their allies initiated the National Minority Movement in 1924 to co-ordinate left-wing sections in the unions.

Despite the rejection of CP affiliation, individual Communists were still able to function as members of the Labour Party, often in their capacity as trade union delegates. Hundreds played an active part in their local constituency Labour parties and some Communist candidates stood with official Labour support. Thus Shapurji Saklatvala became the MP for Battersea North at the 1922 General Election, while J. Walton Newbold won in Motherwell.

The British ruling class and the Labour Party leaders feared the growth of Communist influence, particularly when Ramsay MacDonald headed Britain's first-ever minority Labour government from January 1924. In office but not in power, it quickly collapsed in a frenzy of ruling class anti-Communism. The government's attempt to prosecute JR Campbell, editor of the Communist Party's paper the Workers' Weekly, ended in a fiasco. MacDonald resigned and the election in October was dominated by another 'Red scare'. The Daily Mail and other right-wing newspapers 'leaked' a letter allegedly written by the head of the Communist International, Zinoviev, to the CP in Britain containing instructions for a military seizure of power.

Today, it is beyond dispute that the letter was a forgery, and that the whole affair was concocted and orchestrated by British and French intelligence circles, in league with Russian emigres. But at the time, it signalled the beginning of an intense, unending campaign by agencies of the British state to disrupt the Communist Party through an extensive  programme of infiltration, bugging, burglary and harassment. Within the Labour Party, too, left unity on the ground came under heavy fire from the Labour right wing and over the next few years Communists were gradually driven out of the Labour Party, despite fierce resistance.   

From the outset, Britain's Communists acted in solidarity with the oppressed and super-exploited peoples of the British Empire. As the first Labour government was suppressing the Iraqi Arabs with mustard gas, the 6th CP congress was insisting that 'the continued enslavement of the colonial peoples makes our own freedom in this country absolutely impossible', sending its comradely greetings to Communists and workers in British imperialism's prisons from Egypt to India.

From the beginning, too, the Party did not waver in its support for the principle of an independent united Ireland, free from British rule.

As the British section of the Communist International, the CP was subject to its principles and direction. This also necessitated the construction of a centralised apparatus to lead the Party, staffed by full-time revolutionaries. 'Bolshevisation' also entailed the formation of factory cells. Like many other Communist organisations in other countries, the CP in Britain began to receive substantial financial assistance from the Comintern—as did the Labour Research Department (LRD) and, briefly, the then left-wing Daily Herald.

The Communist Party's own paper, the Workers' Weekly, sought to unite the streams of left opinion, reaching some 40,000 readers (well beyond the Party’s membership of a little over 2,000). In 1925, with the backing of Comintern funds, the Sunday Worker was launched which, with its broad left outlook and content, reached a high-point in circulation of around 100,000. By this time, and distrustful of the National Council of Labour Colleges, the CP had set up its own 90 Marxist study centres around Britain.

Unlike other Communist parties in Europe, the CP in Britain was slow to react to the call of the Young Communist International to establish a dedicated youth section. This was primarily because there was little or no history on the British left of separating ‘youth’ from ‘adult’ organisations. The few progressive youth organisations that existed in Britain were new, raw, lacked coordination and were primarily concerned with socialist political education. Additionally, many of the leading cadres in the Party were young and there was no appetite to segregate them in a separate organisation. Nevertheless, in 1922 the Young Communist League held its founding congress.

The YCL exercised little influence in its early years, with only a small number of functioning branches in London, Glasgow, Manchester and Yorkshire. Yet it was unique in publicising the anti-colonialist, anti-imperialist struggle among young people in Britain through its propaganda and educational schools.

The Communist Party's strength—its base in the industrial unions—also pointed to a major weakness: its failure to recruit and promote more women. Nevertheless, female emancipation featured in the Party's publications from the beginning. The first national conference for Communist women, in 1924, established a CP central women's department headed by organiser Beth Turner.

Throughout 1925, preparations mounted for the coming class battle with Britain's miners, who were determined to resist the coalowners' attack on their wages and conditions. Demands throughout the labour movement for solidarity resulted in a special TUC conference on July 24 and a renewal of the Triple Alliance between the mining, railway and transport unions.

In response, on July 30, Tory Prime Minister Stanley Baldwin issued a declaration of war on behalf of the capitalist class: 'All the workers of this country have got to take reductions in wages to help put industry on its feet'. The next day, 'Red Friday', his government had to retreat before the unity and determination of the mass movement by giving a subsidy to the coal industry to prevent wage cuts.

This victory would not have been won without the tremendous organisational drive of the Communists and their left allies to put trade union leaders under mass pressure. In the words of the resolution moved by miners' leader Arthur Horner at the Party's 7th congress: 'Only through working-class loyalty and working-class solidarity can the workers hope to improve their conditions, and make a successful fight against the attacks of the employers'.