Indonesia has a predominantly Muslim population, though with significant Buddhist (the Chinese populations in the large cities and in West Kalimantan), Hindu and animist minorities (in Bali, Irian Jaya, Sumatra, Kalimantan and other remote outposts). The Batak of North Sumatra, the Ambonese, Florinese and a few tribes in Irian Jaya and Kalimantan are the only pockets of Christianity. Yet the major faiths in the archipelago bear striking differences to their counterparts in other parts of the world because religion in Indonesia is dynamic, not dogmatic, adapted over the centuries to incorporate rituals and beliefs of existing faiths, in particular indigenous animism.

Indonesia is the largest Islamic nation in the world. The northernmost province of Aceh, which received Islam directly from India, is still the most orthodox area, whereas Muslims in the rest of the archipelago follow a style of Islam that has been syncretized with animism, Buddhism and Hinduism. Nearly all Indonesian Muslims are followers of the Sunni sect. Women in veils or full purdah are a rare sight in Indonesia, and men are only allowed two wives, as opposed to four in Arabian countries, though just one wife is the norm.

Animism is still the predominant faith in some of the villages of the outlying islands, particularly Sumatra, Kalimantan and Irian Jaya. The rituals and beliefs vary significantly between each of these islands. Many of these ancient animist beliefs permeate each of the five major religions, and many Indonesian people, no matter what faith they profess, still perform animist rituals.

Despite certain obvious similarities, Balinese Agama Hinduism differs dramatically from Indian and Nepalese Hinduism. At its root lies the understanding that the natural and supernatural world is composed of opposing forces, such as good and evil, order and disorder, gods and demons - and that these forces need to be balanced. Positive forces, or dharma, are represented by the gods and need to be honoured with offerings, dances, paintings and sculptures, fine earthly abodes (temples) and rituals. The malevolent forces, adharma, which manifest themselves as earth demons and cause sickness, death and volcanic eruptions, need to be neutralized with elaborate rituals and special offerings. All Balinese gods are manifestations of the supreme being, Sanghyang Widi Wasa, a deity who is only ever represented by an empty throne-shrine, that stands in the holiest corner of every temple. Sanghyang Widi Wasa's three main aspects manifest themselves as the Hindu trinity: Brahma, Wisnu and Siwa. Siwa's consort is the terrifying goddess Durga, whose Balinese personality is the gruesome widow-witch Rangda, queen of the demons.