Chapter 9.9.0: JIHAD
Jihad means to war against non-Muslims, and is derived from the word mujahada signifying warfare to establish the religion, and it is the lesser jihad.
The greater jihad, it is spiritual warfare against the lower self (nafs), which is why the Prophet - may Allah venerate him and give him peace - said as he was returning from jihad:
We have returned from the lesser jihad to the greater jihad.
The scriptural basis for jihad, prior to scholarly consensus (7.7) is found in such Koranic verses as:
1. (Offensive) fighting is obligatory for you (Koran 2.216);
2. And fight against the unbelievers all together as they themselves fight against you all together . (Koran 9.36);
and such Prophetic quotations (Ahadiths) as the one related by Bukhari and Muslim that the Prophet - may Allah venerate him and give him peace - said:
I have been commanded to fight people until they bear witness that there is no god except Allah and that Muhammad is the Messenger of Allah, and perform the prayer, and pay the obligatory charity (zakat). If they say it, they have saved their blood and possessions from me, except for the rights of Islam over them. And their final reckoning is with Allah;
9.9.8 Objectives of Jihad
The caliph (9.25) makes war upon Jews, Christians (Nazarenes), and Zoroastrians provided he has first invited them to enter Islam in faith and practice, and if they will not, then invited them to enter the social order of Islam by paying the non-Muslim poll tax (jizya, def: 9.11.4). Their circumstances remain as such until they either become covert to Islam or continue paying the non-Muslim poll-tax.
Allah, the Most High says:
Fight those who neither believe in Allah nor the Last Day, who do not forbid what Allah and His Messenger have forbidden, and do not embrace the religion of the truth, being among those who have been given the Book, until they pay tribute out of hand and have been humiliated. (Koran 9.29)
9.9.9 Regarding others:
The caliph fights all other peoples until they become Muslim because they are not a people with a Book, nor honored as such, and are not permitted to settle with paying the poll tax (jizya).
http://allah.com/cgi-bin/mt.cgi?lang=en&cfile=jurisprudence