Many Naruto characters have a distorted view of a peaceful Shinobi world. There are several contentious characters and events in Naruto, most of which are related to the Uchiha Clan. Years ago, a nine-tailed fox caused a massive disaster in Konoha Village, and the village leaders suspect the Uchihas were to blame. The Uchihas were nowhere to be found during the crisis to protect the village. As a result, they were relocated to the outskirts of the village to monitor their activities. Isolation and discrimination bred hatred and mistrust among the Uchihas toward the village leaders over the years.
The Uchihas were permanently excluded from the circle of power, which rotates among the other clans. The very rebellion the village elders hope to quell has grown out of control. So, with the help of some clan members, Fugaku begins a coup to depose the village leaders. Itachi Uchiha, Fungaku's eldest son, is a member of the Anbu corp (village protectors), and his access to the village's information will go a long way in helping the clan carry out their plan. Itachi believed the revolt would only lead to a full-fledged war, which he wished to avoid to save his brother. He gets caught in the middle but spies on his own people instead and reports to the village.
Why The Uchiha Clan Is The Strongest Of All
The Village Elders Hidden Agenda
While the village elders are aware of the Uchiha's coup, which arises due to the villagers' unending scorn and hatred for them. In this situation, the village has two choices: reach an agreement with the Uchihas or eliminate the perpetrators. But the decision was made to wipe out an entire clan, including children, to save the whole village. Itachi took it upon himself to wipe out his clan to keep the supposed peace. He spared his brother, hoping the pain and horror would turn him into a strong ninja.
The schism between the Uchihas and other clans has existed since the time of Madara and Hashirama. For the Uchihas, the immense power of their eyes—the Sharingan—would always be feared, and their thirst for power would be suspected by other clans. And Madara knew that no matter how welcoming their clan tried to be, they would never be accepted. To him, war is an impending disaster, like gunpowder waiting to explode. As a result, came his ideology of establishing a peaceful Shinobi world by acquiring the tailed creatures for the infinite Tsukuyomi.
Itachi's only way to save Konoha village is to kill his entire clan and scar his brother. And the fact that the village leaders did not bother to put out the fires of rebellion by reaching an agreement or perhaps by killing the perpetrators alone could only indicate that there is a hidden agenda. It's always been about the Uchiha's ocular powers; they're so afraid of them that they'd instead wipe the clan off Konoha's map.
For a clan that understands the scope of its power, excluding them from village affairs will only breed animosity and an act of rebellion. Danzo harvested all of the Uchihas' eyes for his selfish use because the ocular power is so feared and desired. Danzo was the mastermind behind the Uchiha clan's massacre. When this became public, the question of Itachi's morality arose. Itachi's ingenuity has led viewers to believe he cannot be duped, despite being tricked by Danzo. Danzo amassed so much power at the expense of his clan that Itachi became a pariah. Danzo's only goal was to control the village and, if necessary, fight for it using the Uchihas' ocular abilities.
Even if Hiruzen Sarutobi's plan for a peaceful resolution appeared weak and prudent, it was always the best option. "Nothing ever goes as planned in this world," Madara Uchiha says, "and as long as there is a concept of victors, the vanquished will also exist." War is justified by a selfish desire for peace, and hatred is born to protect love....' So peace is a fairytale, and Itachi only killed his clan for a fleeting peace, a fairytale that only concentrated more power at the hands of the few. No one has the moral authority to determine right and wrong to the point of inciting and carrying out genocide.