Ar: deen. See also DEEN.
Narrated Abu Huraira:The Prophet said, "Religion is very easy and whoever overburdens himself in his religion will not be able to continue in that way. So you should not be extremists, but try to be near to perfection and receive the good tidings that you will be rewarded; and gain strength by worshipping in the mornings, the nights." (See Fath-ul-Bari, Page 102, Vol 1). (Sahih Bukhari 1.38)
Note that this is a Meccan sura, and Muhammad, being in a disadvantaged position, had sought to persuade the non-Muslims to Islam. At Medina, however, the attitude of Muhammad and the Qur'an hardened, and it was sanctioned that conversion through force is necessary.
Muslims have often quoted this matter of factly that no one is forced into the religion of Islam, that one is free to choose his religion. However, it is also the opinion of most Muslims and theologians that this does not apply to the Muslim; he is not free to leave Islam, and apostasy may even involve the death penalty in many Muslim countries. Malaysia, for example is in the process of passing a law to fine Muslims who become apostates. Thus, no "compulsion in religion" must be seen as only applicable to the non-Muslim, i.e. one is not to be compelled to become a Muslim. Once he or she becomes a Muslim, there is no turning back. He is compelled to remain a Muslim, though. And a person born into a Muslim family has no choice but to remain a Muslim. On the other hand, Muslims in history have also converted non-Muslims to Islam through the sword, i.e., they either have to be killed or banished or become Muslims.
This verse and many others (124 of them in total) have been said to be abrogated by the "sword verse" ayat al-sayf (at-taubah 9:5):
Then, when the sacred months have passed, slay the idolaters wherever ye find them, and take them (captive), and besiege them, and prepare for them each ambush. But if they repent and establish worship and pay the poor-due, then leave their way free. Lo! Allah is Forgiving, Merciful.The last part of the verse: "But if they repent and establish worship and pay the poor-due, then leave their way free." means that if the pagans become Muslims (not any worship, but the Islamic worship, particularly the confession of faith, the shahada, and the Islamic prayer, salat, and the payment of the Islamic tax, zakat), then the Muslims should not continue with killing them, but let them go.
Ibn al'Ata Iqi refers to the sword verse as one of the marvels ('aja'ib) of the Quran! (Powers, David S. "The Exegetical Genre nasikh al-Qur'an was mansukhuhu." in Approaches to the History of the Interpretation of the Qur'an, Andrew Rippin, ed., Oxford: Clarendon Press, 1988, 130-131). Zamakshari agrees with this.
The following hadith also expresses a willingness to use force to accomplish the acceptance of Islam:
Narrated Abu Huraira:
The Verse:--"You (true Muslims) are the best of peoples ever raised up for mankind." means, the best of peoples for the people, as you bring them with chains on their necks till they embrace Islam. (Sahih Bukhari 6.80)
Further reading: Interpreting Qur'an 2:256 and Compel them or Not?