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                                                                     EXHIBIT 5.1


                          [Kirkland & Ellis Letterhead]


                                  June 29, 1998



Allegiance Telecom, Inc.
1950 Stemmons Freeway, Suite 3026
Dallas, Texas  75207

         Re:      Allegiance Telecom, Inc.
                  Registration Statement on Form S-1

Ladies and Gentlemen:

         We are acting as special counsel to Allegiance Telecom, Inc., a
Delaware corporation (the "Company"), in connection with the proposed
registration by the Company of its Senior Notes due 2008 (the "Notes") pursuant
to a Registration Statement on Form S-1 (Registration No. 333-53479), filed with
the Securities and Exchange Commission (the "Commission") under the Securities
Act of 1933, as amended (the "Act") (such Registration Statement, as amended or
supplemented, is hereinafter referred to as the "Registration Statement"). The
Notes are to be sold pursuant to an underwriting agreement (the "Underwriting
Agreement") among the Company, Morgan Stanley & Co. Incorporated, Salomon
Brothers Inc., Donaldson, Lufkin & Jenrette Securities Corporation and Goldman,
Sachs & Co., as representatives of the several Underwriters. The Notes are to be
issued pursuant to an indenture (the "Indenture") between the Company and The
Bank of New York, as trustee.

         In that connection, we have examined such corporate proceedings,
documents, records and matters of law as we have deemed necessary to enable us
to render this opinion.

         For purposes of this opinion, we have assumed the authenticity of all
documents submitted to us as originals, the conformity to the originals of all
documents submitted to us as copies and the authenticity of the originals of all
documents submitted to us as copies. We have also assumed the legal capacity of
all natural persons, the genuineness of the signatures of persons signing all
documents in connection with which this opinion is rendered, the authority of
such persons signing on behalf of the parties thereto other than the Company and
the due authorization, execution and delivery of all documents by the parties
thereto other than the Company. As to any facts material to the opinions
expressed herein, we have relied upon the statements and representations of
officers and other representations of the Company and others. For purposes of
numbered paragraph 1, we have relied exclusively upon certificates issued by
governmental authorities in the relevant

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Allegiance Telecom, Inc.
June 29, 1998
Page 2



jurisdiction and such opinion is not intended to provide any conclusion or
assurance beyond that conveyed by such certificates.

         Our opinion expressed below is subject to the qualifications that we
express no opinion as to the applicability of, compliance with, or effect of (i)
any bankruptcy, insolvency, reorganization, fraudulent transfer, fraudulent
conveyance, moratorium or other similar law affecting the enforcement of
creditors' rights generally, (ii) general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or at law), (iii)
public policy considerations which may limit the rights of parties to obtain
certain remedies and (iv) any laws except the internal laws of the State of New
York, the General Corporation Law of the State of Delaware and the federal law
of the United States of America.

         Based upon and subject to the foregoing qualifications, assumptions and
limitations and the further limitations set forth below, we hereby advise you
that in our opinion:

         (1) The Company is a corporation existing and in good standing under
the laws of the State of Delaware.

         (2) Upon the effectiveness of the Restated Certificate of Incorporation
of the Company and when (i) the Registration Statement becomes effective under
the Act and the Indenture is qualified under the Trust Indenture Act of 1939, as
amended, (ii) the Board of Directors of the Company has taken all necessary
action to fix and approve the terms of the Notes and approve the issuance and
sale of the Notes, (iii) the Notes have been issued in accordance with the terms
of the Underwriting Agreement, upon receipt of the consideration contemplated
thereby, and (iv) certificates representing the Notes have been duly executed
and authenticated in accordance with the provisions of the Indenture, the Notes
will be legally issued, fully paid and nonassessable and will constitute valid
and binding obligations of the Company.

         We hereby consent to the filing of this opinion with the Commission as
Exhibit 5.1 to the Registration Statement. We also consent to the reference to
our firm under the heading "Legal Matters" in the Registration Statement. In
giving this consent, we do not hereby admit that we are in the category of
persons whose consent is required under Section 7 of the Act or the rules and
regulations of the Commission. This opinion and consent may be incorporated by
reference in a subsequent registration statement on Form S-1 filed pursuant to
Rule 462(b) under the Act with respect to the registration of additional
securities for sale in the offering contemplated by the Registration Statement.



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Allegiance Telecom, Inc.
June 29, 1998
Page 3


         We do not find it necessary for the purposes of this opinion, and
accordingly we do not purport to cover herein, the application of the securities
or "Blue Sky" laws of the various states to the issuance and sale of the Notes.

         This opinion is limited to the specific issues addressed herein, and no
opinion may be inferred or implied beyond that expressly stated herein. We
assume no obligation to revise or supplement this opinion should the present
laws of the State of New York, the General Corporation Law of the State of
Delaware or the federal law of the United States be changed by legislative
action, judicial decision or otherwise.


                                                Very truly yours,

                                                /s/ Kirkland & Ellis

                                                KIRKLAND & ELLIS