http://www.aish.com/jl/h/48949566.html
JIHADAt the time of Mohammed's death in 632, Arabia was united and poised for jihad, the "holy war" or "holy struggle" to bring the world to Allah. Shortly, it moved with a fearsome power against the Byzantine and Persian empires.
What did that mean for the Jews?
Answers Rabbi Berel Wein in Echoes of Glory (p. 299):
"Most Jewish historians (until the recent revisionist-historians) are convinced that the Byzantine Church would have attempted to eradicated Judaism totally if the Church itself had not been defeated and its plan for hegemony in Asia Minor and the Mediterranean basin thwarted by the rising tide of Islam. Thus the coming of Islam may be seen as a providential occurrence that allowed the Jews to slip between the cracks Islam made in Byzantine Church persecution. However, as is the case in all historic 'gifts' in Jewish history, the rise of Islam would prove to be only a mixed blessing for Israel."
Jews were classified as ahl al-dhimma, "protected people," and were allowed to live in Islamic countries without being forced to convert. But a whole code of law applied to them, most of it designed to set them apart, humiliate and emphasize their inferior status.
For example, a Jew could never have his head higher than a Muslim. So if a Jew was walking along, and a Muslim passed by, the Jew had to step into the gutter in deference to the Muslim's superior status. A Jew could never testify against a Muslim in court (which basically meant there was no justice for Jews). A Jew could not have a house of worship that was higher than a mosque, which is why (for example) the Four Sephardic Synagogues in the Old City of Jerusalem are subterranean. It should be noted that throughout history some of these laws were not uniformly enforced, and there were periods of time when Jews living in Muslim countries were openly persecuted and others when they were treated very well.
Next we are going to look at one important Jewish community, which at least for a time, flourished under Muslim domination.