Shia-Sunni Whats the deal?

6:159 As for those who divide their religion and break up into sects (شِيَعًا-Shiya'an-Plural of Shia), thou hast no part in them in the least: their affair is with Allah. He will in the end tell them the truth of all that they did.

30:32 Those who split up their Religion, and become (mere) sects ( شِيَعًا),- each party rejoicing in that which is with itself!

As one can see from the above verse that Muslims are fobidden to break up the religion of God into sects/divisions/parties. So how did this division between Sunni and Shia come about. well as with many religious sects and groups what starts off as a political issue becomes a religious and theological one. The issue started with the elction of a leader after the death of the Holy Prophet(pbuh). One group felt that Ali ibn Abi talib the prophets cousin and son in law should be the next in line believing this to be divinely ordained. This party (Shias) believed that the Ahl-ul-Bayt(peopleo fthe house i.e the prophet's (pbuh) family) should be the ones to whom 'the torch was passed'. they therefore reject the other Rashudun Khalifs- the Rightly Guided Caliphs- i.e. Abu Bakr, Umar, Uthman(RA). However by doing so they are insulting a group of people who Allah himself honours in the Quran:

9:100 The vanguard (of Islam)- the first of those who forsook (their homes) and of those who gave them aid, and (also) those who follow them in (all) good deeds,- well- pleased is Allah with them, as are they with Him: for them hath He prepared gardens under which rivers flow, to dwell therein for ever: that is the supreme felicity.

The Shia sect over time has developed from what was a political disagreement to a significant theological difference. The Shias believe that the descendants of Ali(RA) are the true leaders (Imams) of the Muslims. The Shia belief is that an Imam is a Leader, whose guidance extends to spiritual and temporal matters. In other words, an Imam can sanction new laws because he has direct contact with God. This direct contact makes an Imam infallible and invests in him the prerogative of interpreting the Qur'an, thereby gradually revealing its esoteric meaning. Sunnis reject this doctrine of infallibility as theis is giving the attributes of God to human beings and is blasphemy and polytheism (Shirk-the worst sin in Islam).