Ghadir Khum is the famous incident which the Shi'as cite as the proof of Ali’s right to succeed the Prophet Muhammad after his demise.
Ghadir Khum is in fact actually the name of the site which lies between the holy Muslim cities of Mecca and Medina where the event transpired. Here the Hajj caravans separated from each other after the end of the pilgrimage.
On the 18th of Dhil-Hijjah, 10 AH (roughly 15th March, 632 C.E.), the caravan of the Prophet Muhammad stopped there, along with the 120,000-strong crowd of Hajj pilgrims. The Prophet was returning from his last Hajj from the city of Mecca. At that moment, God revealed the following verse to him:
"O Messenger! Proclaim the (message) which hath been sent to thee from thy Lord. If thou didst not, thou wouldst not have fulfilled and proclaimed His mission. And Allah will defend thee from men (who mean mischief). For Allah guides not those who reject Faith" – Chapter 05:67
So Muhammad gathered the pilgrims around him and said, “O people, Hear my words, for it is possible that I may not meet you at this spot in the future. You and I are responsible. Have we carried out the mission?”
The pilgrims replied, “We testify that you have fulfilled your mission”. Then the Prophet said, “I am leaving two memorable things among you; one of them is the Book of Allah and the other is my household, and if you abide by them you will never go astray”.
Then the Prophet called upon Ali and said, “O People who is the most competent to the faithful?” The people answered, “God and His messenger know better.” At this juncture, Muhammad raised Ali’s hand and said: “God is my Master and I am the master of the faithful. Whosever master (mawla) I am from now on Ali is his master”. He repeated these sentences three times and then said, “May God be friend with anyone who makes friendship with Ali and be enemy to anyone who has enmity toward Ali. Love whoever loves Ali and hate whoever hates Ali. O people! Those present should convey these remarks to those who are absent.”
According to numerous Islamic scholars (both Sunni and Shi'a), the event of Ghadir Khum is a credible one which has been narrated by about 100 companions of the Prophet. The debate lies in the definition attributed by either side to the term mawla adopted in the Prophetic tradition. The Shi'as prefer 'master' and the Sunnis 'friend'.