This paper aims at analyzing the concept of nationhood and loyalty in Islam as enshrined in the Dustūr al-Madīnah (the Charter of Medina) and the Bukit Seguntang Covenant of the Malay world. The authors give special focus on the universal values that are features salient in the Charter of Medina and in the Bukit Seguntang Covenant of the Malays. Through a qualitative methodology, the authors made comparative and textual analyses on both treatises and on related materials. The findings reveal that both documents exhibit principles and values, such as loyalty, tolerance and others, that are universal in nature and are not contradictory. Today, some practices committed by Malay Muslims under the name of Islam, yet are incongruent with the principles and values mentioned in the Medina Charter and in the Covenant, do not represent Islamic teachings but a gross distortion instead.