Literary approaches to the Bible are actually quite ancient, but the modern academic approaches and methodologies that are subsumed under this rubric date from the middle of the twentieth century. Early seeds were sown by biblical scholars who did comparative work with ancient Near Eastern texts. Newly discovered Ugaritic poetry bore a remarkable resemblance to biblical psalms in its use of parallelism and the combination of so-called word pairs in parallel lines, as well as in shared divine imagery. From another direction came James Muilenburg's “rhetorical criticism” (an outgrowth of form criticism), in which the focus was on the distinctiveness of each text. This distinctiveness was ascertained by examining its stylistic traits, especially on the patterning of words and themes, rather than concentrating on the features it shared with other texts in its genre. A third precursor was the work of the formalist Vladimir Propp, whose Morphology of the Folktale described the underlying plot development and the functions of main character types in folktales. In a quite different move from Muilenburg's, Proppian analysis of biblical narratives put the spotlight on universal narrative structures that the Bible shared with other literatures and provided a new way to understand them.
But the field of biblical scholarship at large really took notice when several literary scholars applied literary criticism to the narratives of the Hebrew Bible: first, Erich Auerbach, who compared the narrative styles in Homer and the Bible, and then, most famously, Robert Alter and Meir Sternberg, who developed more thorough-going modes of analyzing biblical narrative derived from the study of modern fiction. (A similar phenomenon occurred in New Testament studies at about the same time; Northrop Frye and Frank Kermode are among the early notables.) In fact, when many people think of literary approaches to the Bible, they think of narrative poetics of the type first demonstrated by Alter and Sternberg, and then by a host of successors from among both literary and biblical scholars. Biblical scholars until that point had been oriented toward historical and philological disciplines, and literary analyses came as something of a revelation, opening as they did the doors to new kinds of interpretation. It was not long, however, before a range of applications of current literary theory and practice to the biblical text found a secure place in the field of biblical studies.