Despite intensive research, the mechanism of graphene oxide (GO) formation remains unclear. The role of interfacial interactions between solid graphite and the liquid reaction medium, and transport of the oxidizing agent into the graphite, has not been well-addressed. In this work, we show that formation of GO from graphite constitutes three distinct independent steps. The reaction can be stopped at each step, and the corresponding intermediate products can be isolated, characterized, and stored under appropriate conditions. The first step is conversion of graphite into a stage-1 graphite intercalation compound (GIC). The second step is conversion of the stage-1 GIC into oxidized graphite, which we define as pristine graphite oxide (PGO). This step involves diffusion of the oxidizing agent into the preoccupied graphite galleries. This rate-determining step makes the entire process diffusive-controlled. The third step is conversion of PGO into conventional GO after exposure to water, which involves hydrolysis of covalent sulfates and loss of all interlayer registry.