The version that appears in prayer books today includes this crucial sentence, followed by excerpts from three different parts of the Torah: A paragraph about loving God, a paragraph about reward and punishment, and a paragraph about tzitzit.
Long ago, the third paragraph of the Shema was quite different than it is today: It was the Ten Commandments. ”The Ten Commandments are the very essence of Shema,” says Rabbi Ba in the Jerusalem Talmud (Berakhot 1:5), where we learn that reciting the Ten Commandments every day was common practice. Ultimately, says the Talmud, the Commandments were excluded because the rabbis were worried that people might start to think the Ten Commandments were the only part of the Torah that was divinely-inspired.
Early substitutions for the Ten Commandments included the entirety of Parashat Balak, three whole chapters–but the rabbis decided that this was way too long to impose on people to say every day. At last, they decided to include what we now know as the third paragraph of the Shema, commanding the Jewish people to tie fringes around their garments–a union of the fundamentally intangible notion of God with the very physical idea of clothing.