The matter flared up again in 1896 and soon divided Frenchmen into two irreconcilable factions. In 1896 Col. Georges Picquart, chief of the intelligence section, discovered evidence indicating Major Ferdinand Walsin Esterhazy, who was deep in debt, as the real author of the bordereau. Picquart was silenced by army authorities, but in 1897 Dreyfus's brother, Mathieu, made the same discovery and increased pressure to reopen the case. Esterhazy was tried (Jan., 1898) by a court-martial and acquitted in a matter of minutes.

Émile Zola, a leading supporter of Dreyfus, promptly published an open letter (J'accuse) to the president of the French republic, Félix Faure, accusing the judges of having obeyed orders from the war office in their acquittal of Esterhazy. Zola was tried for libel and sentenced to jail, but he escaped to England. By this time the case had become a major political issue and was fully exploited by royalist, militarist, and nationalist elements on the one hand and by republican, socialist, and anticlerical elements on the other.

The violent partisanship dominated French life for a decade, dividing the country into two warring camps. Among the anti-Dreyfusards were the anti-Semite Édouard Drumont; Paul Déroulède, who founded a patriotic league; and Maurice Barrès. The pro-Dreyfus faction, which steadily gained strength, came to include Georges Clemenceau, in whose paper Zola's letter appeared; Jean Jaurès; René Waldeck-Rousseau; Anatole France; Charles Péguy; and Joseph Reinach. They were, in part, less concerned with Dreyfus, who remained in solitary confinement on Devils Island, than with discrediting the rightist government. The larger questions posed by the case involved the future of France itself, whether it would remain traditional or become modern, be Catholic or secular, function as a monarchy or a republic, and have a nationalist or a cosmopolitan character.

Later in 1898 it was discovered that much of the evidence against Dreyfus had been forged by Colonel Henry of army intelligence. Henry committed suicide (Aug., 1898), and Esterhazy fled to England. At this point revision of Dreyfus's sentence had become imperative. The case was referred to an appeals court in September and after Waldeck-Rousseau became premier in 1899, the court of appeals ordered a new court-martial. There was worldwide indignation when the military court, unable to admit error, found Dreyfus guilty with extenuating circumstances and sentenced him to 10 years in prison.

Nonetheless, a pardon was issued by President Émile Loubet, and in 1906 the supreme court of appeals exonerated Dreyfus, who was reinstated as a major and decorated with the Legion of Honor. Subsequently promoted, Dreyfus served in World War I as a colonel in the artillery. In 1930 his innocence was reaffirmed by the publication of Schwartzkoppen's papers. The immediate result of the Dreyfus Affair was to unite and bring to power the French political left wing. Widespread antimilitarism and anticlericalism also ensued; army influence declined, and in 1905 church and state were separated in France and legal equality among Catholics, Protestants, and Jews was established. At his death in 1935, Dreyfus was hailed as a French hero and a martyr for freedom.