During
the Second Buddhist Council in the North Indian town of Vesali, about
70 years after Buddha’s Parinirvana there was a big point of contention
within the Buddhist community. It was the proper conduct and discipline
of the Sangha (the monks) as well as the Vinaya, the regulatory
framework for the Sangha. It was for this reason, that the reformist
Sthavira group split from the conservative majority Mahasamghikas.
The Sthavira group would later be divided into other groups including
 • the Sarvastivada (which influenced Chinese and Tibetan Buddhism) as well as
 •
the Vibhajyavada which would give rise to a great number of schools,
like the Tamraparniya school, which we now call Theravada
The Mahasamghikas later went on the accept the existence of the Mahayana school
 • Some scholars believe, that the Mahayana tradition developed as a lay movement outside of Mahasamghikas.
 •
Some scholars believe, that the Mahayana tradition developed out of the
Mahasamghikas and might have influenced each other later on but this is
a matter of debate.

By
the 1st century BCE, Buddhism had splintered into as much as 18
different schools, which all had their own rendition or version of the
Buddhist Canon or Tripitaka. However, it is believed that at this point
in time the core (especially the Sutta part) was largely similar. It was
around this time, that the schools started to write down the Buddhist
Canon (it would be more correct to say ‘their Canon’). It generally
consisted of around 30 books, though later Buddhist traditions,
especially Mahayana have added more texts to their Tripitaka as well as a
plethora of uncanonical text. The oldest and most complete fully extant
Canon, the Pali Canon of the Theravada tradition was first compiled in
the 3rd century BCE and first written down during the Fourth (Theravada)
Buddhist Council in 29 BCE.
The oldest found Sri Lankan exemplar was
dated back to the 5th or 6th century CE. It was written in Pali, the
language of the Sthavira vibhajyavada, which even today is still studied
as a sacral language by Theravada Buddhists.
It is important to note
that the Pali Canon is not the oldest piece of Buddhist scripture ever
found. In fact, there even are parts of the Pali Canon that were
translated into different languages and are older than the Sri Lankan
(for example a Chinese translated part dating back to the 4th century
CE). The honor of oldest found text goes to the Gandharan Buddhists
texts found in modern day Pakistan, which date back to the 1st century
CE. Gandharan texts possibly belonged to the Dharmaguptaka school.
Cross-comparisons with the Pali Canon revealed that the core of the
texts could be found in the Pali Canon.