The dichotomy in the colonial education policy meant that the élite were distanced from participation in the on-going production of Malay literature. Literature came to be centred in the Malay-educated, who were largely teachers and journalists. A study of modern Malay literature has to take cognizance of this fact. Modern Malay literature was the product of the non-élite who were predominantly of rural background and whose education upheld the rural bias with its intention of strengthening the tie between the land and the village world. This close link between literature and the peasantry was to have a far-reaching effect on modern Malay literature as a whole.

Prior to the appearance of the Penulis Guru, as the teacher-writers were known, and the Penulis Wartawan (journalist-writers), the Malay literary scene already bore the imprint of the efforts of a group called Penulis Agama (religion-writers). These were Middle-Eastern educated Malays who, influenced by the Islamic reformism of Turkey and Egypt, took home with them a new understanding of an insight into Islam. Their ideas were vigorously expressed and debated in the newspapers and magazines, foremost amongst which were Al-Imam (1906-09, terminal date is unclear) and later Al-Ikhwan (1926-31) and Saudara (1928-41). The old ulama or authorities on religion, who were closely allied to the traditional élite as advisors on matters of religion, did not accept the new ideas, and the disagreement culminated in the famous Kaum Tua - Kaum Muda clash (Roff 1967). Syed Sheikh Al-hadi, a prolific campaigner of the new understanding, carried his ideas into the realm of fiction in the first Malay novel, Hikayat Setia Asyik kepada Maksyuknya atau Syafik Afandi dengan Faridah Hanum [The story of a lover's faithfulness to his beloved or Syafik Afandi and Faridah Hanum], which was well received. Finding fiction writing a lucrative enterprise, he produced a series of romantic stories, mainly adaptations from Egyptian and Turkish literature, under the title, Angan-Angan Kehidupan [Life's fantasies], and also a series of detective stories entitled, Cerita Rokambul [The story of Rokambul], all of which were published by his own Jelutong press.