The advancement of time and technological progress bring complex dynamics to the implementation of Islamic law in modern society. This study aims to analyze the development of Islamic legal sources and examine the understanding methods of Islamic legal studies through textual and contextual approaches. This research employs a normative legal research method with a theological approach derived from the Qur'an and As-Sunnah, alongside a conceptual approach through the analysis of ushul fiqh theories. The results indicate that the Qur'an and As-Sunnah hold the position as the primary sources of Islamic law. However, to respond to contemporary legal issues, such as the development of Islamic economics and e-commerce transactions, intellectual effort (ijtihad) through ijma’ and qiyas is required. The textual approach focuses on linguistic analysis and literal meanings to preserve fundamental teachings, whereas the contextual approach considers social-historical conditions to create adaptive and solution-oriented law. Integrating both approaches proportionally, while adhering to unalterable sharia boundaries such as Islamic creed (aqidah) and core rituals (ushul ibadah), is crucial to maintaining the relevance of Islamic teachings in the modern era.