Shortly after Luther's disputation with Eck in Leipzig, rumors circulated that Rome was preparing a papal bull condemning Luther's reformism as heresy and threatening him with excommunication. Luther was not sure whether the rumored bull was genuine or simply a ruse concocted by Eck to threaten him into submission. In Against the Bull of the Antichrist, Luther launched a preemptive attack and condemned "whoever wrote this bull" as the Antichrist. He challenged Eck and his other critics to "show that I am a heretic, or dry up their spittle."

A work that vividly displays Luther's growing estrangement from the Catholic Church, The Babylonian Captivity of the Church was published only a few months after To the Christian Nobility. With the papal bull looming, The Babylonian Captivity marks Luther's shift from reform to open revolt. Luther abandons the relatively moderate tone of his earlier work and aims an embittered and angry attack against the foundation of the church's authority. Comparing the church to the infamous biblical city of Babylon, Luther argues it has abused Christ's sacraments in the interest of maintaining its power as an intermediary between God and the faithful. The prominent woodcut portrait by Hans Baldung Grien is an example of the importance of artists in the growing popular awareness of Luther as an individual facing the arrayed powers of church and state.

Pope Leo promulgated the bull condemning Luther's unrepentant indictment of the Catholic Church in June 1520, and an official copy finally reached Luther at Wittenberg in October. Commonly known by the Latin phrase in its opening lines, Exsurge, Domine (Arise, O Lord), the bull accuses Luther of heresy and issues an ultimatum: recant the heretical statements in the Ninety-five Theses and other writings within sixty days or face excommunication. Luther's works were to be burned in public, and all Christians who owned, read, or published them faced automatic excommunication. Luther now had reason to fear for his life: the punishment for heresy was burning at the stake.

The freedom of the individual is a thread running through much of Luther's work and endowed his theological arguments with a political and social force both church and state were quick to recognize. Luther drafted On the Freedom of a Christian with an accompanying letter to Pope Leo shortly after receiving the papal bull. A manifesto of individual freedom in faith, On the Freedom of a Christian would become one of the most important documents in the establishment of a new, reformed church. Facing the threats of excommunication and execution, Luther makes an impassioned plea for the individual liberty of the Christian in his personal relationship with God and his fellow man, unmediated by earthly powers. In his letter to Pope Leo, Luther takes a conciliatory tone toward the pontiff, but only to distinguish him, "a sheep among wolves, like Daniel among the lions," from the "godlessness" of the Roman curia, which he compares to Babylon, Sodom, and Gomorrah. Although addressed to the pope, Luther published his message in German as an open letter intended for a national audience. By the time Pope Leo received it, in a language he could not read, it had already become a bestseller.

Thanks to the medium of print, Luther was arguably the first "celebrity" in history outside of Europe's royal dynasties, and his likeness was among the most well known in Europe. Luther made shrewd use of this status by staging a dramatic act of defiance: on December 10, the pope's sixty-day deadline to recant or be excommunicated, he burned the papal bull in public. Surrounded by students and colleagues outside the gates of Wittenberg, Luther cast the bull into the bonfire along with other anti-Luther works and editions of canon law. In Luther's time, burning a person's works was a powerfully symbolic act akin to burning the person himself. Luther's gesture was partly in retaliation for the church's burning of his works as instructed by the papal bull. With this mutual consigning to the flames, the split between Luther and Rome was now irrevocable. Less than four weeks later, on January 3, 1521, the pope formally declared Luther a heretic.