The rabbis who made their way to Babylonia joined an ancient Jewish community, descendants of Jews who first came to that land at the time of the biblical exile. In that setting, the Babylonian rabbis enjoyed, along with their brothers and sisters, relative peace and comfort, allowing them to explore and elaborate the traditions they learned from their colleagues to the west. But the inherited rabbinic tradition was only one of the forces that shaped the Babylonian Talmudic tradition. There were also the many historical and cultural factors – the traditions of ancient Persia, Zoroastrianism, eastern Christianity, and others – that contributed to the shape of the local rabbinic tradition. In this chapter we review the historical and cultural factors that shaped Babylon in the centuries during which the Bavli emerged. We examine the growth of this rabbinic community and its relationship with the recognized head of the Babylonian Jewish community, the exilarch. Finally, we trace the trends of study that gave birth to a work that, despite its traditional vocabulary, represents what is arguably a radical new “tradition.”