October 12, 2000: AQY attacked the USS Cole using a boat filled with explosives in Aden, Yemen. (17 killed, 35 wounded) 
March 15, 2009: A suicide bomber attacked a group of South Korean tourists, killing six of the tourists and two of their Yemeni tour guides in Shibam. (8 killed, unknown wounded) 
July 8, 2015
Al Qaeda in Yemen (AQY) was a militant Islamist group based in Yemen and the Yemeni branch of the Al Qaeda (AQ) franchise from 2000 until 2009 when it merged with its Suadi counterpart to create Al Qaeda in the Arabian Peninsula (AQAP).
Modern jihadi communities have been active in Yemen since the end of the Afghan war against Soviet occupation in the 1980s. After the war, many mujahideen were not allowed to return to their home countries and settled in Yemen with Yemeni veterans of war in Afghanistan, who then-president Saleh repatriated. Saleh reportedly hired these mujahideen to fight his enemies, from secessionists in the south to Marxists.  Analysts credit an unstable political environment, a powerful tribal system, a weak local economy, and mountainous geography with providing a safe haven for extremist militants. For these reasons, Osama bin Laden identified Yemen as a desirable location to headquarter his organization.  Al Qaeda had maintained a presence in the country since the 1990s, consisting mainly of foreign nationals who were recruiting Yemenis, and the main Islamic militant groups in the country between 1990 and 2003 all claimed to maintain ties with bin Laden throughout the period. 
It is unclear when AQY officially coalesced as a cohesive group. It did not carry out large-scale attacks until it first emerged on a global scale with the October 12th, 2000 bombing of the USS Cole in the Aden harbor, which killed seventeen.  Following the attack, the U.S. and Yemeni governments cooperated in carrying out counterterrorism initiatives against AQY, despite Saleh’s earlier dealings with militant Islamists. The U.S. government dispatched Special Forces and intelligence personnel supporting the efforts. In 2002, the first U.S. drone strike in the region killed AQY leader Abu Ali al-Harithi.  Originally attributed to the Yemeni government, the strike was later acknowledged by Washington as a CIA operation.
By 2003, AQY membership had drastically declined and the group was largely decimated after several of its leaders were either killed or imprisoned by joint US-Yemeni efforts.  Further, Al Qaeda focused on operations in Saudi Arabia from 2003 to 2006, while Yemenis interested in carrying out violent jihad were largely directed to Iraq to participate in the insurgency there.  After the initial surge in AQ operations in Saudi Arabia, the Saudis cracked down on AQ and many of the AQ members who managed to escape fled into Yemen.  Meanwhile, both the Yemeni and U.S. government shifted focus away from combating the group and experts claim that this lapsed vigilance after the initial crackdown on AQY in 2001 played a part in the group’s resurgence in late 2005 and early 2006. 
This resurgence was fueled when the group carried out an attention-grabbing jailbreak that freed twenty-three of its members from a Yemeni prison in February 2006. The group that escaped included many high-ranking members of AQY, most notably Nasir al-Wuhayshi, the soon-to-be leader of AQY and founder Al Qaeda in the Arabian Peninsula (AQAP).  After this period, analysts debated whether there had been a split in the AQY membership on the ground, as one group called itself “Al Qaeda Organization in the South of the Arabian Peninsula” while the other claimed attacks under the name of “Al Qaeda Organization of Jihad in the Arabian Peninsula: The Soldiers’ Brigades of Yemen.” However, others classified the two groups as overlapping cells within the same organization, and most sources continued to report on the group as a single entity, AQY. 
Together with Qasim al-Raymi, also a prisoner who escaped in 2003, Wuhayshi went on to revitalize AQY. The group began to carry out more attacks. A failed suicide bombing in September 2006 at oil and gas facilities was followed by an assassination of the chief criminal investigator pursuing the case of the attempted bombings. In June 2007, a suicide bomber attacked a convoy of Spanish tourists, allegedly in response to Yemeni security forces killing five militants.  In September 2008, AQY undertook one of its largest operations, attacking the American Embassy in Sanaa in an assault that killed ten.  In addition to its militant attacks, AQY began publishing an online newspaper entitled Sada al-Malahim ("Echoes of Epic Battles") in January 2008. The newspaper, published in Arabic, served as a mouthpiece and recruiting tool for the organization. 
In 2009, Wuhayshi and Raymi merged AQY with the Saudi AQ branch, creating Al Qaeda in the Arabian Peninsula (AQAP). Wuhayshi became the leader of AQAP.  The organization retained AQY members and tactics, and continued to publish Sada al-Malahim. 
Please see AQAP profile for more current information.
It is unclear who led AQY from 2003 to 2006.
Abu Ali al-Harithi (2000 to November 2002): Harithi was AQY's original leader and a citizen of Yemen. He reportedly fought alongside Osama bin Laden in the war against the Soviet army in Afghanistan, and became a close associate of bin Laden in Sudan in the early 1990s. Harithi was killed in the first CIA drone strike in the Arabian Peninsula. 
Muhammad Hamdi al-Ahdal (2000 to 2003): Also known as Abu Asem al-Macci, Ahdal was a prominent AQ leader and the financial organizer for AQY, and reportedly played a role in the bombing of the USS Cole. He was arrested in Yemen in November 2003 and in 2006 was sentenced to three years and one month of imprisonment. His current whereabouts are unknown. 
Nasir al-Wuhayshi (2006 to 2009): Wuhayshi, also known as Abu Basir, lead AQY after breaking out of prison with 23 others in early 2006. Wahayshi commanded AQY until its merger with AQAP in 2009, and subsequently became the commander of AQAP. 
Ideology & Goals
The goals and ideologies of AQY were consistent with those of AQ. Their literature and statements claimed that AQY intended to expel "infidels, Crusaders and Zionists" from the Holy Land. The group also sought to replace the U.S.-supported Yemeni government with a fundamentalist Islamic regime. 
The U.S. and the UN did not designate AQY a terrorist organization until after it became Al Qaeda in the Arabian Peninsula (AQAP) in 2009.
AQY likely received support and funds from Al Qaeda central. 
AQY was not influenced by foreign governments.
AQY was based in Yemen and operated mainly out of Sanaa.
Targets & Tactics
AQY followed Al Qaeda’s strategy in its targets and tactics. It often utilized suicide bombers and car bombs in its attacks.
Like Al Qaeda, the group targeted U.S. and western interests. However, most of its attacks were directed at the Yemeni government in retaliation for security crackdowns against the group. 
AQY was not active in Yemeni politics.
October 12, 2000: AQY attacked the USS Cole using a boat filled with explosives in Aden, Yemen. (17 killed, 35 wounded).
October 31, 2005: AQY gunmen ambushed and killed policemen in Sa’dah City, Yemen. Authorities suspected AQY’s involvement but no group claimed responsibility for the attack. (12 killed, unknown wounded).
July 3, 2007: A suicide bomber attacked Spanish tourists visiting a Yemeni temple. Less than two weeks earlier, the U.S. issued a terrorism warning for the region. (9 killed, unknown wounded).
May 30, 2008: AQY militants fired two rockets at oil pipelines and refineries. (No casualties).
September 17, 2008: AQY militants attacked the U.S. Embassy in Sanaa with two car bombs. (16 killed, unknown wounded).
October 20, 2008: A parcel bomb was detonated in Sanaa City, San'a province of Yemen, killing Shaykh Mohammad bin Rabeesh Kaalan, security chief for Madghal district. Analysts believe AQY perpetrated the attack, although the group did not claim responsibility for the bombing. (1 killed, 1 wounded).
March 15, 2009: A suicide bomber attacked a group of South Korean tourists, killing six of the tourists and two of their Yemeni tour guides in Shibam. (8 killed, unknown wounded).
Relationships with Other Groups
AQY operated under the Al Qaeda umbrella and was often guided and supported by Al Qaeda’s top leaders, including Zawahiri and bin Laden. The group is also believed to have cooperated with several other organizations that promoted similar ideologies, including the Aden-Abyan Army. 
AQY attempted to maintain close relationships with the Sunni tribes of rural Yemen. AQY paid tribal leaders for support. The tribes, however, also took money from Marxists, Iraqis, and Saudis despite ideological differences, and therefore were not solely committed to supporting AQY.  Foreign members desiring to join AQY often married into Yemeni tribes to solidify their presence in local communities and allow them to stay in the country. 
In contrast, AQY was unpopular in the northern Houthi regions in Yemen due to ideological differences; Houthis are Zaidis, members of a small Shiite sect, while AQY is Sunni. While the two groups sought similar goals of an Islamic state and both shared anti-American sentiments, mutual distrust and ideological differences prevented the two groups from working together. 
^ Vick, Karl. "Yemen Pursuing Terror in Its Own Way; Tactics, Results Vary, but the Target is al-Qaeda." Washington Post. 17 October 2002. A14.