Buddha, born Siddhartha Gautama, was born and reared as a Hindu. His father, a tribal governor, wanted to protect his son from suffering, and therefore raised him in a very sheltered environment. Later, however, when he saw sickness and death; he realized that the world was full of suffering and sorrow. Ultimately, he reached his time of enlightenment in which he determined that all life involves suffering; suffering is caused by desire, that one can end suffering (and therefore suffering) by ending desire; and one could end desire by following the "eight fold path."
Buddha's response to Hinduism was that it did not answer the fundamental questions of life, namely why do humans suffer. Had he not found Hinduism insufficient to answer this question, he would not have sought enlightenment on his own. He accepted the Hindu doctrine of reincarnation and karma based on ones previous life; but rejected the caste system. This latter position made Buddhism attractive to the lower castes.
In essence, Buddha's response to Hinduism is similar to Christianity's response to Judaism and Islam's response to Christianity: the religion is largely correct; but is somewhat incomplete and imperfect.
The Buddha adopted many of the terms already used in philosophical discussions of his era;
Karma is a word meaning action or activity and, often implies its subsequent results. It is commonly understood as a term to denote the entire cycle of cause and effect as described in the philosophies of a number of cosmologies, including those of Buddhism and Hinduism.In Buddhism, since a person's word , thought, and action form the basis for good and bad karma, sila (moral conduct) goes hand in hand with the development of meditation and wisdom. The Buddha derived his teaching of the concept of kamma through direct experience rather than from the existing culture.
Dharma means Natural Law or Reality, and with respect to its significance for spirituality and religion might be considered the Way of the Higher Truths. A Hindu appellation for Hinduism itself is Sanātana Dharma, which translates as "the eternal dharma." Similarly, Buddhadharma in an appellation for Buddhism. Buddhism and Jainism are continuations of this tradition, and the early Upanishadic movement was influenced by it. According to Hinduism, the soul (atman) is immortal, while the body is subject to birth, decay, old age and death. The meme of reincarnation is intricately linked with the notion of karma, another concept first recorded in the Upanishads. Karma is the sum of one's actions, and the force that determines one's next reincarnation. The cycle of death and rebirth, governed by karma, is referred to as samsara.Buddhism developed an understanding of a 'continuum or stream of skanda' through such disciplines as vipassanā and shamata, which has become reified in later Buddhist discourse as the Mindstream doctrine, a reification that Shakyamuni Buddha would have challenged.