The middle way avoids both eternalism and annihilationism

Early Buddhist texts describe the Buddha steering a deliberate course between two positions he judged equally mistaken. Eternalism, shashvata-drishti in Sanskrit, holds that a person possesses some fixed, essential self, an eternal soul, that survives death unchanged. Annihilationism, ucchedavada, holds the opposite, that death is a total end and nothing about a person continues or matters beyond it. The Buddha rejected both, not by proposing a third fixed position between them but by reframing the question itself around dependent origination, the teaching that things arise and cease based on conditions rather than the terms either extreme assumes. On this account a person is neither an eternal, unchanging soul carried across lifetimes intact nor simply annihilated at death with nothing continuing; what continues is a causal process, a stream of dependently arising conditions, without any fixed essence riding inside it. This middle position, distinct from the better known ethical middle way between asceticism and sensual indulgence described in the Buddha's first sermon, is a philosophical middle way about the nature of existence and continuity, and it underlies the Buddhist teaching of rebirth without a transmigrating soul, a position later Buddhist philosophers spent centuries working out in increasing technical detail.

Several centuries after the Buddha's death, the philosopher Nagarjuna built an entire school of thought, Madhyamaka, meaning middle way, around systematizing this avoidance of eternalism and annihilationism into a rigorous philosophical position. Nagarjuna's central claim is that all phenomena are empty, shunya, of any fixed, independent essence, because everything that exists does so only in dependence on causes, conditions and the concepts used to identify it. This emptiness, he argued, is not the same as nonexistence; things still function, still cause and are caused, still support ordinary experience and ethical responsibility, but none of them possesses the independent, unchanging essence that an eternalist position would require. Nagarjuna's critics repeatedly accused Madhyamaka of nihilism, reading emptiness as a denial that anything real exists at all, a charge his texts respond to directly by insisting that dependent, conventional existence and the emptiness of independent essence are not in conflict but require each other, since only something without a fixed essence could ever change, arise or cease in the first place. Madhyamaka became one of the two great philosophical schools of Indian Mahayana Buddhism, and its central move, holding a middle position between an eternal essence and outright nonexistence, remains the most systematic working out of the middle way the earliest texts had already pointed toward.