Multiple influences contributed to the development of Chan. One of these was early Buddhism as it was understood to have been practiced by the Buddha. The second patriarch of Chan, Huike, practiced asceticism and lived in the forests away from urban areas. He called for a return to the fundamentals of the tradition as taught by the Buddha—asceticism and meditation. Even as Chan moved to urban areas and became associated with centers of power, it continued to identify itself as a practice that returned to the basics of Buddhism.
Despite the interest in early Buddhist practices, it was the later Mahayana scriptures that had the greatest appeal to Chan monks and scholars. Of particular importance to Chan were The Perfection of Wisdom Sutras (especially the Vajracchedika Sutra), the Garland Sutras, the Vimalakirti Sutra, and the Lankavatara Sutra.
Among Buddhist philosophers, the thoughts of Indian monk and scholar Nagarjuna (c. 2nd-3rd c.) appealed to many Chan scholars because of his systematic deconstruction of all Buddhist principles. While some early Buddhists pursued an understanding of emptiness through concentrated meditation, Nagarjuna approached it through logical analysis. He used logic to show the limitations of any ultimate explanation of existence and non-existence, or of spiritual attainment. For Nagarjuna, early Buddhist teachings about impermanence and emptiness logically demanded that one should relinquish all views about everything. If nothing has permanent form, then there is no permanent truth either. Chan teachers would employ both concentration and analytical techniques to reveal the limitations of logical thought.
Two schools of Indian Buddhist philosophy particularly influential in the development of Chan were Madhyamika and Yogacara. Nagarjuna is regarded by some as the founder of the Madhyamika, or Middle Way school. Madhyamika argued that things have no inherent nature, and that reality is beyond all distinctions. There is no substance to ultimate reality, and nothing exists independently of anything else. For some, Madhyamika was a form of nondualism in which all oppositions are erased. The Madhyamika philosopher Jizang, who lived in China, stated that all things are empty, and at the same time, all things are one.
Yogacara is often known as the "mind-only" school. As the name implies, some advocates of this view believed that nothing but the contents of the mind are real, or to put it another way, that mind is the metaphysical basis of phenomena. Yogacara's primary proponent, Asanga, had a somewhat different idea. He described phases of discernment that would eventually lead to an experience beyond all distinctions, unknowable by the intellect, followed by a return to the world of phenomena experienced without delusion. Regardless of these distinctions, meditative techniques and practice geared toward attaining the experience of ultimate reality were essential to the Yogacara School.
Out of these philosophical ideas, Chan would develop its own arguments about emptiness and Buddha-nature. Like Candrakirti, many Chan thinkers advocated the deconstruction of all views. Like Jizang, some Chan thinkers argued that all things are empty, and yet one. Like Asanga, some proponents of Chan believed that the deconstruction of distinctions would lead to an experience of the world of phenomena without the distorting filter of delusion. Finally, as did the Yogacara school, Chan meditation teachers developed techniques to explore the nature of consciousness. In the case of Chan, however, the idea was to propel the mind beyond logic and categories of experience into a state that transcended both logic and experience.
Outside of Buddhism, a significant influence on Chan in China was Taoism. The first textual reference to Buddhism in Chinese, from imperial records of the Emperor Ming Di (reigned 58-75 C.E.), is an account of a Chinese nobleman who combined Buddhist and Taoist practices. Another reference from the 2nd century mentions a Taoist practitioner who added Buddhist rituals to rites in honor of the emperor. A story began about this time, with variations that persist to this day, that the Buddha was actually the Taoist Laozi (Lao-tzu), who had left China to go west. The more common variation of the story is that after he left China, Laozi traveled to India where he became the Buddha's teacher.
Buddhism and Taoism had some similar practices, such as concentration and breath control exercises, and individuals often practiced techniques from each tradition in combination. A Buddhist teacher from Parthia who arrived in China in 148 and was given the Chinese name of An Shih-kao, was a meditator and translator who, because of these interests, focused on translating Buddhist texts about meditation and concentration practices into Chinese. Other translations of Buddhist texts throughout the 2nd and 3rd centuries had a similar focus.