The Baha’i View of Islam:
The Baha’i view on that subject is that the Dispensation of Muhammad, like all other Divine Dispensations, has been fore-ordained, and that as such forms an integral part of the Divine plan for the spiritual, moral and social, development of mankind. It is not an isolated religious phenomenon, but is closely and historically related to the Dispensation of Christ, and those of the Bab and Baha’u’llah. It was intended by God to succeed Christianity, and it was therefore the duty of the Christians to accept it as firmly as they had adhered to the religion of Christ.
You should also cautiously emphasize the truth that due to the historical order of its appearance, and also because of the obviously more advanced character of its teachings, Islam constitutes a fuller revelation of God’s purpose for mankind.
(Shoghi Effendi: Lights of Guidance, p. 496)

As to Muhammad, the Apostle of God, let none among His followers who read these pages, think for a moment that either Islam, or its Prophet, or His Book, or His appointed Successors, or any of His authentic teachings, have been, or are to be in any way, or to however slight a degree, disparaged.
(Shoghi Effendi: The Promised Day is Come, p. 108)

Indeed, the essential prerequisites of admittance into the Baha’i fold of Jews, Zoroastrians, Hindus, Buddhists, and the followers of other ancient faiths, as well as of agnostics and even atheists, is the wholehearted and unqualified acceptance by them all of the divine origin of both Islam and Christianity, of the Prophetic functions of both Muhammad and Jesus Christ, of the legitimacy of the institution of the Imamate, and of the primacy of St. Peter, the Prince of the Apostles.
(Shoghi Effendi: The Promised Day is Come, p. 110)

The guidance vouchsafed to the Imams regarding the laws and institutions of Islam was absolute and unqualified. Their infallibility was derived directly from the Manifestation.
(Shoghi Effendi: Lights of Guidance, p. 497)

Place in Religious History:
Muhammadanism is not only the last of the world religions, but a fuller Revelation than any one preceding it. The Qur’an is not only more authoritative than any previous religious gospel, but it contains also much more; ordinances, teachings and precepts, which taken together constitute a fuller Revelation of God’s purpose and law to mankind than Christianity, Judaism or any other previous Dispensation. This view is in complete accord with the Baha’i philosophy of progressive revelation, and should be thoroughly accepted and taught by every loyal … Baha’i.
(Shoghi Effendi: Unfolding Destiny, p. 432)

From the standpoint of institutionalism Islam far surpasses true Christianity as we know it in the Gospels. There are infinitely more laws and institutions in the Qur’an than in the Gospel. While the latter’s emphasis is mainly, not to say wholly, on individual and personal conduct, the Qur’an stresses the importance of society. This social emphasis acquires added importance and significance in the Baha’i Revelation. When carefully and impartially compared, the Qur’an marks a definite advancement on the Gospel, from the standpoint of spiritual and humanitarian progress.
(Shoghi Effendi: Lights of Guidance, p. 496)

The Faith of Islam, the succeeding link in the chain of Divine Revelation, introduced, as Baha’u’llah Himself testifies, the conception of the nation as a unit and a vital stage in the organization of human society, and embodied it in its teaching.
(Shoghi Effendi: The Promised Day is Come, p. 120)

Contributions to Humanity:
Muhammad appeared among such a people. He educated and unified these barbarous tribes, put an end to their shedding of blood. Through his education they reached such a degree of civilization that they subdued and governed continents and nations. What a great civilization was established in Spain by the Muhammadans! What a marvelous civilization was founded in Morocco by the Moors! What a powerful caliphate or successorship was set up in Baghdad! How much Islam served and furthered the cause of science!
(`Abdu’l-Baha: Japan Will Turn Ablaze, p. 46)

In the early ages of Islam the peoples of Europe acquired the sciences and arts of civilization from Islam as practiced by the inhabitants of Andalusia. A careful and thorough investigation of the historical record will establish the fact that the major part of the civilization of Europe is derived from Islam; for all the writings of Muslim scholars and divines and philosophers were gradually collected in Europe and were with the most painstaking care weighed and debated at academic gatherings and in the centers of learning, after which their valued contents would be put to use.
(`Abdu’l-Baha: Secret of Divine Civilization, p. 89)

Islam attained a very high spiritual state, but Western scholars are prone to judging it by Christian standards. One cannot call one World Faith superior to another, as they all come from God; they are progressive, each suited to certain needs of the time.
(Shoghi Effendi: Directives of the Guardian, p. 40)

Current Condition:
Behold, O Muhammad, how the sayings and doings of the followers of Shi’ih Islam have dulled the joy and fervor of its early days, and tarnished the pristine brilliancy of its light. In its primitive days, whilst they still adhered to the precepts associated with the name of their Prophet, the Lord of mankind, their career was marked by an unbroken chain of victories and triumphs. As they gradually strayed from the path of their Ideal Leader and Master, as they turned away from the Light of God and corrupted the principle of His Divine unity, and as they increasingly centered their attention upon them who were only the revealers of the potency of His Word, their power was turned into weakness, their glory into shame, their courage into fear. Thou dost witness to what a pass they have come. Behold, how they have joined partners with Him Who is the Focal-Point of Divine unity. Behold how their evil doings have hindered them from recognizing, in the Day of Resurrection, the Word of Truth, exalted be His glory.
(Baha’u’llah: Gleanings, p. 69)

“O people of the Qur’an,” Baha’u’llah, addressing the combined forces of Sunni and Shi’ih Islam, significantly affirms, “Verily, the Prophet of God, Muhammad, sheddeth tears at the sight of your cruelty. Ye have assuredly followed your evil and corrupt desires, and turned away your face from the light of guidance. Erelong will ye witness the result of your deeds; for the Lord, My God, lieth in wait and is watchful of your behavior… O concourse of Muslim divines! By your deeds the exalted station of the people hath been abased, the standard of Islam hath been reversed, and its mighty throne hath fallen.”
(Shoghi Effendi: World Order of Baha’u’llah, p. 179)

Followers of each religion have tended to allow their devotion to its Founder to cause them to perceive His Revelation as the final Word of God and to deny the possibility of the appearance of any subsequent Prophet. This has been the case of Judaism, Christianity and Islam. Baha’u’llah denies the validity of this concept of finality both in relation to past Dispensations and to His own. With regard to Muslims, He wrote in the Kitab-i-Iqan that the “people of the Qur’an … have allowed the words `Seal of the Prophets’ to veil their eyes”, “to obscure their understanding, and deprive them of the grace of all His manifold bounties”.
(The Universal House of Justice: Aqdas: Notes, pp. 243-244)

The Study of Islam:
Perused ye not the Qur’an? Read it, that haply ye may find the Truth, for this Book is verily the Straight Path. This is the Way of God unto all who are in the heavens and all who are on the earth.
(Baha’u’llah: Gleanings, p. 44)

First is the importance of the study of Islam – which subject is still new to the majority of the believers, but whose importance for a proper and sound understanding of the Cause is absolutely indispensible.
(Shoghi Effendi: Lights of Guidance, p. 562)