No one wants to be called “legalistic.” It’s probably worse than being called an idiot or even an expletive. So what is it? There are various definitions, but I see two aspects of it. One is relative to justification; the other, sanctification.
This first aspect of legalism, related to justification, is the belief that salvation is earned by good works. This is basic man-made Religion. It says, be a good person and you’ll get into heaven (or nirvana, or higher state of reincarnation, what have you). If you’re an evangelical Christian, particularly if you consider yourself Reformed or Calvinist, you obviously don’t believe this. I would contend that Protestant Christianity is the only religion out there that is not legalistic in this sense. Every other religion I am aware of requires that you obey certain commands and practices to earn salvation. Protestant Christianity requires you to put your faith in Jesus, who did it for you (for a more detailed account of how one gets saved, see my post on the gospel).
The second aspect of legalism, related to sanctification, is the adding of commands and traditions to Christian living that is not stated in the Bible. For example, many youth pastors seem to preach that Christians should not listen to secular music. I’ve heard of stories where youth groups would gather together and burn their CDs of Snoop Dogg and Dr. Dre (this is before the advent of the iPod). But what text is this based on? Maybe it’s based on Phil 4:8, where Paul exhorts his readers that whatever is true, honorable, just, pure, lovely, etc. think about such things. But I would contend this is a broader command, whereby the more specific applications are to be determined by the individual through the conviction of the Holy Spirit. God may personally convict you to stop listening to secular music for a time–if that’s something that stumbles you. And your obedience to that particular conviction is something you shouldn’t ignore. But to make it a universal command for everyone is what legalism is all about.
It’s hard enough following the commands that Jesus gave through his apostles and ultimately his Word. We don’t need to add any more commands, as if God’s weren’t enough. If you’re going around telling people they’re wrong for doing things that God doesn’t prohibit through his Word, either directly or in principle, then you’re a legalist. If you’re going around thinking that your lifestyle is earning your spot in heaven, you’re a legalist. And if you’re squeezing God’s Word to fit your traditions and man-made commands, then–you’ve guessed it–you’re a legalist.