After the early School of Antioch came into decline, the presbyter Diodore of Tarsus re-founded it in the middle of the fourth century as a semi-monastic community. He was a native of Antioch who had studied philosophy in Athens together with his friend Basil of Caesarea. In Antioch he became famous for his orthodox steadfastness against the Arian bishops that ruled the city at that time. In 378 Diodore left Antioche to become Bishop of Tarsus and his student Theodore of Mopsuestia became the new head of the school.

Diodore and Theodore were strong opponents of the heresy of Apollinaris, who maintained that Christ was the divine word dwelling in a human body, but without a human soul. In response, they insisted that Christ had both a divine and a human soul, which were connected but distinct. The Alexandrian school on the other hand taught a union of the two persons of Christ.

The teaching Diodore and Theodore is the foundation of the Assyrian (Nestorian) theology.