It is my opinion based on the things I have read that the term Jew has always been race related. In ancient Israel you had the 12 tribes where Jews (yehudi) were members of the tribe of Judah. Later the term broadened and it meant those who lived in the Kingdom of Judah, not considering tribe affiliation (but still, sons of Jacob).
This was a race issue because the Jews where not allowed to marry non-Jews. Their religion was also only for Jews*. The sect that Jesus and his apostles organised in the 1st century AD was strictly for Jews and the apostles were forbidden to preach to the gentiles. It was Peter who later changed this when he had his vision about the forbidden food on a blanket.
There was also a problem with part Jews, something that the New Testament repeatedly illustrates. The Samaritans, originally a mix of Jewish descent and Babylonian decent, wanted to be recognised as Jewish but were despised by the Jews.
* There were cases of gentiles converting to Judaism, but they were never considered Jewish but were called proselytes.
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