The Communist Party of Great Britain (CPGB) was the largest communist organisation in Britain and was founded in 1920 through a merger of several smaller Marxist groups. Many miners joined the CPGB in the 1926 general strike. In 1930, the CPGB founded the Daily Worker (renamed the Morning Star in 1966). In 1936, members of the party were present at the Battle of Cable Street, helping organise resistance against the British Union of Fascists. In the Spanish Civil War, the CPGB worked with the USSR to create the British Battalion of the International Brigades, which party activist Bill Alexander commanded.

In World War II, the CPGB followed the Comintern position, opposing or supporting the war in line with the involvement of the USSR. By the end of World War II, CPGB membership had nearly tripled and the party reached the height of its popularity. Many key CPGB members served as leaders of Britain's trade union movement, including Jessie Eden, David Ivon Jones, Abraham Lazarus, Ken Gill, Clem Beckett, GCT Giles, Mike Hicks, and Thora Silverthorne.

The CPGB's position on racial equality and anti-colonialism attracted many black activists to the party, including Trevor Carter, Charlie Hutchison, Dorothy Kuya, Billy Strachan, Peter Blackman, George Powe, Henry Gunter, Len Johnson, and Claudia Jones, who founded London's Notting Hill Carnival. In 1956, the CPGB experienced a significant loss of members due to its support of the Soviet military intervention in Hungary. In the 1960s, CPGB activists supported Vietnamese communists fighting in the Vietnam War. In 1984, the leader of the CPGB's youth wing, Mark Ashton, founded Lesbians and Gays Support the Miners.

From 1956 until the late 1970s, the party was funded by the Soviet Union. After the dissolution of the Soviet Union in 1991, the party's Eurocommunist leadership disbanded the party, establishing the Democratic Left. In 1988 the anti-Eurocommunist faction launched the Communist Party of Britain, which still exists today.

The Communist Party of Great Britain was founded in 1920 after the Third International decided that greater attempts should be made to establish communist parties across the world. The CPGB was formed by the merger of several smaller Marxist parties, including the British Socialist Party, the Communist Unity Group of the Socialist Labour Party and the South Wales Socialist Society. The party also gained the support of the Guild Communists faction of the National Guilds League, assorted shop stewards' and workers' committees, socialist clubs and individuals and many former members of the Hands Off Russia campaign. Several branches and many individual members of the Independent Labour Party also affiliated. As a member of the British Socialist Party, the Member of Parliament Cecil L'Estrange Malone joined the CPGB. A few days after the founding conference the new party published the first issue of its weekly newspaper, which was called the Communist and edited by Raymond Postgate.

In January 1921, the CPGB was refounded after the majorities of Sylvia Pankhurst's group the Communist Party (British Section of the Third International), and the Scottish Communist Labour Party agreed to unity. The party benefited from a period of increased political radicalism in Britain just after the First World War and the Russian Revolution of October 1917, and was also represented in Britain by the Red Clydeside movement.

During the negotiations leading to the initiation of the party, a number of issues were hotly contested. Among the most contentious were the questions of "parliamentarism" and the attitude of the Communist Party to the Labour Party. "Parliamentarism" referred to a strategy of contesting elections and working through existing parliaments. It was a strategy associated with the parties of the Second International and it was partly for this reason that it was opposed by those who wanted to break with Social Democracy. Critics contended that parliamentarism had caused the old parties to become devoted to reformism because it had encouraged them to place more importance on winning votes than on working for socialism, that it encouraged opportunists and place-seekers into the ranks of the movement and that it constituted an acceptance of the legitimacy of the existing governing institutions of capitalism. Similarly, affiliation to the Labour Party was opposed on the grounds that communists should not work with 'reformist' Social Democratic parties. These Left Communist positions enjoyed considerable support, being supported by Sylvia Pankhurst and Willie Gallacher among others. However, the Russian Communist Party took the opposing view. In 1920, Vladimir Lenin argued in his essay "Left Wing" Communism: An Infantile Disorder that the CPs should work with reformist trade unions and social democratic parties because these were the existing organisations of the working class. Lenin argued that if such organisations gained power, they would demonstrate that they were not really on the side of the working class, thus workers would become disillusioned and come over to supporting the Communist Party. Lenin's opinion prevailed eventually.

Initially, therefore, the CPGB attempted to work within the Labour Party, which at this time operated mainly as a federation of left-wing bodies, only having allowed individual membership since 1918. However, despite the support of James Maxton, the Independent Labour Party leader, the Labour Party decided against the affiliation of the Communist Party. Even while pursuing affiliation and seeking to influence Labour Party members, however, the CPGB promoted candidates of its own at parliamentary elections.