Formal and descriptive. In everyday speech, and among Muslims themselves, the usual word is 穆斯林. 徒 'follower' builds the other faiths the same way: 佛教徒 Buddhist, 基督教徒 Christian, 天主教徒 Catholic.
mistakes
Not the same as 回族, the Hui people: that is an ethnic group, most of whose members are Muslim.