The Signs and Wonders Movement, also called the Third Wave, has made tremendous inroads into evangelicalism since the early 1980’s. After initial arguments against it in the late 1980s and early 1990s, debate has mostly subsided. Current general opinion has been acceptance, indifference, or tolerance of the movement and its view of spiritual gifts, especially its form of ‘prophecy.’ The prime justification for the revival of what this group terms the ‘prophetic gift’ has been the work of Wayne Grudem. Many articles, including those of the present writer, have examined the exegetical, theological, and doctrinal errors of his position. The present article uses a unique approach to refuting Grudem’s viewpoint of non-authoritative congregational prophecy by examining the earliest ‘charismatic’ crisis in the early church, the one caused by the Montanist movement. The earliest ancient sources to refute Montanism reveal how the early church immediately after the apostolic period understood the gift of prophecy. An examination of the ancient churches’ understanding of prophecy and refutation of Montanism also supplies a striking condemnation of Grudem’s viewpoint and strongly reinforces the argument that he has imposed a novel as well as unorthodox interpretation of the NT gift of prophecy.