Postcolonial theology is the application of postcolonial criticism to Christian theology. As in postcolonial discourse, the term postcolonial is often used without a hyphen, denoting an intellectual reaction against the colonial.

Postcolonial theologians argue that, in the past, the dominant Western form of Christianity is actually determined, shaped, and defined by European colonialism, implying and reinforcing notions such as Eurocentrism, colonial exploitation, and the superiority of European values and culture. Therefore, critical examination is needed, and alternative interpretations to colonially-tainted narratives need to be constructed. This is done by "revisiting the question of how indigenous cultures can contribute to theology and biblical studies".

Although decolonization took place shortly after the Second World War, postcolonial theories did not emerge until the late 1970s. The field of postcolonial theology, correspondingly, did not arise until the 1990s.

Notable biblical scholars include R. S. Sugirtharajah and Fernando Segovia and theologians include Musa W. Dube, Wai-Ching Angela Wong, Kwok Pui-lan, and Mayra Rivera.

Given its similarities with literary analysis, it is not surprising that biblical studies was the first field within Christian studies to apply postcolonial criticism. Adopting postcolonial critical methods, biblical studies is inspired to take into account issues of "expansion, domination, and imperialism" in examining existing biblical interpretation, and in constructing new narratives. Indigenous non-Western approaches to theologizing the Bible, previously neglected under the colonial context "in favor of European methods", are now revisited, in hope to "make the Bible comprehensible to the colonized cultures on their own terms". Therefore, traditional fields of translation, exegesis, and hermeneutics in biblical studies have to be reconsidered in light of postcolonial criticism, and non-Western perspectives have to be taken into account, even as focal points.

Among various scholars, R. S. Sugirtharajah, one of the principal advocates of postcolonial biblical studies, outlined in his book The Bible and the Third World three hermeneutic approaches which emerged after colonialism: the native or vernacular approach, the liberation approach, and the postcolonial approach.

There are certain benefits of applying postcolonial criticism to biblical studies. First, it opens up potential areas and possibilities for interdisciplinary work, enriching the discipline by enabling multiple approaches to bring in their insights. Second, it allows for criticism towards the way things are done, including the principles and presuppositions of the field. In addition, it also avoids detachment from the contemporary world, as work done in the discipline would have to respond to postcolonial contexts.

Reviewing Christian history from a postcolonial critical perspective, history is realized to be intrinsically more than just impartial facts. As history is essentially a narrative of what happened, it is always an interpretation, which is "bound by time, place, and the social, political, religious, cultural and economic positions of writers", and a representation, being an "interested construction of representation through which power is expressed, reflected, and exercised."