Legalism is a sign of spiritual immaturity and stunted or unbalanced growth in the Christian life.
As we grow in understanding of Biblical principles we seek to bring our lives in line with those Biblical principles. Often we do that by establishing rules or fences in our own mind as to what our individual response will be to that principle. I may decide to avoid certain behavior, or limit certain activities to certain occasions, places, or etc. The particular behavior in and of itself is not immoral, but I avoid it because it brings me close to immoral behavior that I want to avoid.
The problem comes when we make our fences and personal rules, or cultural norms and expectations, the sine qua non of the Biblical principle we are trying to guard in our life. At that point if your fence and rules don't line up with my fence and rules, you are obviously in violation of the Biblical principle, and thus living in "sin", and of course it is my duty to inform you of the same and call you to "repentance". At that point I've become a legalist.
Corporately, a church that is marked by legalism is also an immature church, and marked by stunted or out of balance Christian growth. Such churches also become a dangerous place. In Scriptures the only thing legalism produced was Pharisaical hypocrisy. So it is also in the history of the church since New Testament times.
The saddest thing about legalism is how so often the legalist doesn't recognize his or her legalisim, and would indignantly deny the charge. Of course, any one that doesn't subscribe to their legalisim must obviously be an "antinomian". Ad homminum argumentation is often a sign of a legalist.
The legalist has lost sight of the grace of God either in initial salvation or in on-going sanctification, or both. He may give lip service to the grace of God, but his practice of legalism denies the grace of God. Such a person becomes a Christian with a split personality, mouthing the theology intellectually, but denying the theology in practice.
Another mark of legalism is the focus on externals. For example, a legalist may tell you so and so is not converted. You ask him or her why he or she is saying that, and what they give as evidence is externals that often have nothing to do with real godliness. You may point out to the legalist how the person in question exhibits the fruit of the Spirit as set forth in Galatians. It goes right over their head...
Worst of all is when the legalist considers him or herself to be the "mature" Christian in relation to everyone else... When that happens to a Pastor, the results are disastrous to Pastor and congregation. That I have sadly seen with my own eyes.
The cure for legalism is to focus on Christ and His grace. We stand in Him and His work alone not only for salvation, but also sanctification. The legalist is not viewing sin as being as sinful as it really is. If he or she did, they would despair and abandon all hope in themselves and find that true Sabbath that remains for the people of God in our Lord Jesus Christ and in Him alone.
Sola Deo Gloria!
~ The Billy Goat ~