Legalism has the tendency to pervert the law. It is often through not hearing all that the Law says. Legalism is always out of balance. It must sustain its point to the expense of other vital truths. Faith only, to the exclusion of baptism, is a kind of legalism--though its prononents think of themselves as understanding grace better than others. Some KJV-only people among us make laws from their devotion to the KJV to the exclusion of anyone else's understanding. The one-cup brethren lose sight of various passages implying the need for multiple cups and stress the one cup to the exclusion of any other option. When the canon came down that one could not be a good Christian without observing Christmas and Easter, we see legalism clearly.
Legalism is always out-of-balance. The Pharisees embraced their oral torah so strongly that they rebuked Jesus for not observing the traiditon of the elders (Matthew 15; Mark 7). They did not realize they had given a place to their humanly-devised tradition that equaled written revelation. They supposed Moses had orally handed down their traditions. It was not that Jesus was unclean but that he did not follow their tradition. At the same time, they replace the written revelation about honoring parents with their self-serving practice of making contributions.
Legalism despises the true law of God. It edits it, confuses it, ignores it, annuls it, or changes it to the benefit of the legalist.
A legalist will blast others for not following his revered edicts. Like the Pharisees, he will assign others to condemnation for not following his rules.
Jesus shows the folly of not following His words in Matt. 7:21-27 (cf. John 8:31), but He is no legalist. There is a difference between the real Divine standard of truth and the humanly devised one. The problem comes in that the legalist is fully persuaded that his humanly-devised belief or practice is from God (when, in point of fact, it is not).
To press what God says to the exclusion of other revealed matters can become legalistic. But to press what God has said in context, because God said it is not legalism. It is obedience and compliance.
If I press John 3:3-7 to a Baptist friend, I am no legalist. I should press it, because the Lord pressed it. If I press immersion to a sprinkled friend, I am no legalist. I should by all means press it, because it is indeed the only manner of baptism into Christ. Now, I didn't make up baptism or immersion. I can read it in Scripture.
What is legalistic is when someone defends the notion that sprinkling an infant is as good as immersing a penitent believer. They are saying their humanly-devised practice is as valid as God's own way. This is an editing of the command that in reality despises it. It says we have a better way that is just as good as the Scriptural way.
The Pharisees were blind guides, and legalism tends to blind people to the truth. They must turn their eyes from the whole picture that they might press others with their partial picture.
I want to know and hear about the grace of Christ, but not to the exclusion of His teaching on truth and repentance. I want to hear of the need for unity in Christ but not to the exclusion of the Truth which is the basis of that unity. I do not believe in a baptism without faith or without repentance or without love.
Legalism is out-of-balance because at its heart is the desire to pepetuate the doctrines of the self more than the doctrine of God.