It was formed in 1919 as a splinter group of the left-wing of the Socialist Party over the issue of the Bolshevik Revolution in Russia. The left wing socialists supported Lenin and Trotsky, and broke off the SP to form two rival parties: the Communist Party of America and Communist Labor Party. Under pressure from the Communist International, these two communist parties officially merged in Chicago in 1919. From its inception, the Communist Party, USA came under attack from the FBI and Attorney General A. Mitchell Palmer for defying the Sedition Act of 1918. Consequently, the Communist Party went underground and went through name changes to evade the authorities.
Since its inception, the CPUSA was known for closely following the orders of the Communist International (“Comintern”). This was evident in 1928 when, upon the orders of Stalin, the CPUSA expelled James Cannon and the Trotskyist left opposition from the organization only to expel the new leadership under Jay Lovestone a year later.
After 1929 the party was led by Earl Browder who actually dissolved the party in 1944 replacing it with a Communist Political Association. For this he was in turn expelled and James Z. Foster became head of the party. Foster was to lead the party until he retired in 1958 and was succeeded by Gus Hall.
The 1956 invasion of Hungary and the Secret Speech of Nikita Khrushchev to the Communist Party of the Soviet Union criticising Stalin had a cataclysmic effect on the CPUSA. Membership plummeted and the leadership briefly faced a challenge from a faction who wished to democratise the party. However most of its critics left and after 1958 Hall also purged the party of a small faction who wished to return to a Stalinist course. This small faction went on to form the Progressive Labor Movement in 1961.
In 1948, Eugene Dennis, William Z. Foster and other CPUSA leaders were arrested under the Alien Registration Act. This law, passed by Congress in 1940, made it illegal for anyone in the United States "to advocate, abet, or teach the desirability of overthrowing the government".
The case began in March, 1948. It was difficult for the prosecution to prove that the twelve men had broken the Alien Registration Act, as none of the defendants had ever openly called for violence or had been involved in accumulating weapons for a proposed revolution. The prosecution therefore relied on passages from the work of Karl Marx and other revolution figures from the past.
Another strategy of the prosecution was to ask the defendants questions about other party members. Unwilling to provide information on others, they were put in prison and charged with contempt of court. The trial dragged on for eleven months and eventually, the judge, Harold Medina, who some say made no attempt to disguise his own feelings about the defendants, sent the party's lawyers to prison for contempt of court.
After a nine month trial the leaders of the American Communist Party were found guilty of violating the Alien Registration Act and sentenced to five years in prison and a $10,000 fine. They appealed to the Supreme Court but on 4th June, 1951, the judges ruled, 6-2, that the conviction was legal.
This decision was followed by the arrests of 46 more communists during the summer of 1951. This included Elizabeth Gurley Flynn, who was also convicted for contempt of court after telling the judge that she would not identify people as Communists as she was unwilling "do degrade or debase myself by becoming an informer". She was also found guilty of violating the Alien Registration Act and sentenced to two years in prison.
In the 1970s, the CPUSA managed to grow in membership to about 25,000 members, despite the exodus of numerous Anti-Revisionist and Maoist groups from its ranks. However, in 1984, seeing the onslaught of Ronald Reagan's anti-Communist administration and decreased CPUSA membership, Gus Hall chose to end the CPUSA's nation-wide electoral campaigns, and the CPUSA has endorsed the Democratic Party in every national election ever since. The CPUSA still runs candidates for local office.
Throughout most of its history the Communist Party has been under pressure from the United States government, especially the FBI and was heavily infiltrated. Following the McCarthy years, membership and activities of the Communist Party were kept secret with very few visible members, although the Party claims that many community leaders thoughout the United States were affiliated with the Party.
From 1959 until 1989 when Gus Hall attacked the initiatives taken by Gorbachev in the Soviet Union the Party received a substantial subsidy from the Soviet Union. Starting with $75,000 in 1959 this was increased gradually to $3 million in 1987. This substantial amount reflected the Party's subservience to the Moscow line in contrast to the French and Italian Parties whose Eurocommunism deviated from the orthodox line. The cutoff of funds in 1989 resulted in a financial crisis resulting in cutting back publication in 1990 of the Party newspaper, the People's Daily World to weekly publication.
Communist party members consider Party membership an honor and often work very hard toward realization of the idealistic goals of communism. Generally the life of a Communist is organized around Party activities with the expectation that they will in a disciplined way advance the goals of the Party.
Communists have often participated in the organization of quasi-independent organizations (front groups) which support some aspect of their platform or serve organizing goals. In addition, Communist Party members, working together within an organization such as a labor union proceeding skillfully, were often able, together with others who supported them (or at least did not actively oppose them), to rise to leadership positions and in some cases to dominate the organization. In some cases, especially in labor organizations such as the Screen Actors Guild this practice resulted in a backlash as more conservative members such as Ronald Reagan  competed for control of the organization.
The current National Chair is Sam Webb. The newspaper is the People's Weekly World.