The Hall resistivity in ferromagnetic materials has an anomalous contribution proportional to the magnetization, which is defined as the anomalous Hall effect (AHE). Being a central topic in the study of ferromagnetic materials for many decades, the AHE was revived in recent years by generating many new understandings and phenomena, e.g. spin-Hall effect, topological insulators. The phase diagram of the AHE was shown recently to exhibit three distinct regions: a skew scattering region in the high conductivity regime, a scattering-independent normal metal regime, and an insulating regime. While the origin of the metallic regime scaling has been understood for many decades through the expected dependence of each contribution, the origin of the surprising scaling in the insulating regime was completely unexplained, leaving the primary challenge to the last step to understand fully the AHE. In this dissertation work we developed a theory to study the AHE in the disordered insulating regime, whose scaling relation is observed to be omega_xy^AH is proportional to omega_xx^(1.40∼1.75) in a large range of materials. This scaling is qualitatively different from the ones observed in metals. In the metallic regime where kFl > > 1, the linear response theory predicts that omega_xx is proportional to the quasi-particle lifetime tau, while omega_xy^AH scales as alpha*tau beta*tau^0, indicating that the upper limit of the scaling exponent is 1.0. Basing our theory on the phonon-assisted hopping mechanism and percolation theory, we derived a general formula for the anomalous Hall conductivity (AHC), and showed that the AHC scales with the longitudinal conductivity as omega_xy^AH ~ omega_xx^gamma with gamma predicted to be 1.33 <= gamma <= 1.76, quantitatively in agreement with the experimental observations. This scaling remains similar regardless of whether the hopping process is long range type (varible range hopping) or short range type (activation E3 hopping), or is influenced by interactions, i.e. Efros-Shklovskii (E-S) regime. Our theory completes the understanding of the AHE phase diagram in the insulating regime.