WHAT IT IS
The term "legalism" or "legalist" is not found in the Bible, but the serious error of legalism is certainly dealt with, especially by the Apostle Paul who ever and always boasted in the cross and championed the grace of God (Gal. 6:14; 1:6). Perhaps the best way to see what Paul had to say about how the flesh wrongly uses the law is to read carefully through the epistle to the Galatians.
Legalism and Justification
It is the deadly error of legalism that teaches that justification or salvation is by the works of the law. The legalists of Judaea said it this way, "Except ye be circumcised after the manner of Moses, ye cannot be saved" (Acts 15:1). Paul clearly confronted this error in Galatians 2:16--"Knowing that a man is not justified by the works of the law, but by the faith of Jesus Christ, even we have believed in Jesus Christ, that we might be justified by the faith of Christ, and not by the works of the law: for by the works of the law shall no flesh be justified."
The law can show us how unjust we are (Rom. 3:20b) and thus it can show us our need for justification, but the law can never justify: "Therefore by the deeds of the law there shall no flesh be justified in His sight" (Rom. 3:20). "If righteousness come by the law, then Christ is dead in vain" (Gal. 2:21).
Legalism and Sanctification
The law cannot justify; neither can it sanctify. The law can show us that we are unholy but it can never make us holy. The key to living the Christian life is not found at Mount Sinai, but it is found at Mount Calvary (Romans 6; Gal. 2:20).
Paul argued strongly that the Christian life must be continued on the basis of faith, not on a legal basis: "This only would I learn of you, Received ye the Spirit by the works of the law, or by the hearing of faith? Are ye so foolish? having begun in the Spirit, are ye now made perfect by the flesh?" (Gal. 3:2-3). The Christian life is to continue just as it commenced! "As ye have therefore received Christ Jesus the Lord, so walk ye in Him" (Colossians 2:6).
Holiness does not come by seeking to keep the law in the energy of the flesh. C.H.Mackintosh defined legality as "the flesh attempting to carry out the precepts of God." How successful is the flesh? "For I know that in me (that is, in my flesh,) dwelleth no good thing: for to will is present with me; but how to perform that which is good I find not" (Rom. 7:18 and see verse 24).
The Believer and the Law
Two key facts must be kept in mind. First, the believer is not under the law (Rom. 6:14). In fact the believer has died to the law that he might live unto God (Gal. 2:19; and see Rom. 7:1-6). He is not under the legal rule, but he is under the new creature rule (Gal. 6:15).
Second, the believer is not lawless (Rom. 6:1-2). We died to the law so that we might be married to Christ and out of this relationship we bring forth fruit unto God (Rom. 7:4). The life of a true believer should manifest fruitfulness not lawlessness.
Those legalists who try to put themselves under the law do not keep the law (Gal. 6:13; Acts 15:10), but those believers who walk in the Spirit keep the law by way of the fruit of the Spirit: "That the righteousness of the law might be fulfilled in us, who walk not after the flesh, but after the Spirit" (Romans 8:4 and compare Galatians 5:22-23).
WHAT IT IS NOT
Being obedient to God's specific commands is not legalism. "And hereby we do know that we know Him, if we keep His commandments. He that saith, I know Him, and keepeth not his commandments, is a liar, and the truth is not in him" (1 John 2:3-4).
Living a holy life that is set apart unto the Lord's service is not legalism. "For this is the will of God, even your sanctification [holiness], that ye should abstain from fornication....For God hath not called us unto uncleanness, but unto holiness" (1 Thessalonians 4:3,7).
Living a life separated unto Christ and separated from the fads and fashions of the world is not legalism. "And be not conformed to this world: but be ye transformed by the renewing of your mind, that ye may prove what is that good, and acceptable, and perfect, will of God" (Romans 12:2).
Conforming one's life to be in harmony with certain standards decided upon by Spirit-led leaders of a local assembly of believers is not legalism. "That ye abstain from meats offered to idols, and from blood, and from things strangled, and from fornication: from which if ye keep yourselves, ye shall do well. Fare ye well" (Acts 15:29).
Forgoing my personal rights for the sake of my brother is not legalism. "It is good neither to eat flesh, nor to drink wine, nor any thing whereby thy brother stumbleth, or is offended, or is made weak" (Rom. 14:21).
In true separation Biblical principles are understood and external standards are implemented. In legalism Biblical principles are ignored and external standards are exalted. In libertinism Biblical principles are forgotten and external standards are despised. The third description seems to be where the vast majority of the church is moving today.
-borrowed from middletownbiblechurch