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A common historiographical observation draws a line from the Spanish expulsion, through Sabbateanism, to the Hasidic movement. While the intellectual history of this line has been developed by scholars such as Simon Dubnow, Martin Buber and Gershom Scholem, literary and cultural questions regarding the discursive capital of Sepharad in shaping the movement are largely absent from the study of Hasidism. In fact, memories and imaginings of Sepharad played a constitutive role, both in building the movement’s cultural capital and as a discursive structure for engaging their contemporary moment. This paper seeks to view Hasidism through the prism of what Yael Halevi-Wise has termed “Sephardism.” It begins by contextualizing the various forms of early Sephardism in the Hasidic movement. These forms ranged from alterations of traditional liturgy to popularization of Lurianic mysticism, and were subject to the earliest attacks by the movement’s orthodox opponents in the late eighteenth century. In the early nineteenth century, when ideas of emancipation reopened questions about social homogeneity, Sepharad became a touch point for one notable Hasidic rabbi’s representation of his contemporary dilemmas. The paper will proceed to discuss a tale by Nachman of Braslav (1772–1810), “The King Who Decreed Conversion.” In it, a literary representation of Anusim (crypto-Jews) in post-Expulsion Sepharad is the setting for an exploration of the social and cultural challenges Hasidism faced, with the modernization of the Russian Pale of Settlement, in Nachman’s own generation. The paper will thus read both the text and context of Hasidism through the prism of the movement’s Sephardism.