Two of the more common hermeneutical and theological viewpoints within the world of Bible-believing Christianity are dispensationalism and covenant theology.  Each position represents a version of Biblical orthodoxy. Both perspectives generally affirm the major doctrines of the Christian faith, such as the inspiration and inerrancy of the Bible, the deity of Christ and the Virgin Birth, salvation by grace through faith in the blood atonement of Christ on the cross, the bodily resurrection of Jesus from the grave, and the visible and literal second coming of Christ. Thus it is possible for the two camps to recognize the members of the opposite group as spiritual brothers in Christ. However, they disagree strongly on many significant theological points. In particular, these disagreements often involve how one views the expression of continuity and discontinuity between the Old and New Testaments. Lurking behind this issue are certain hermeneutical and theological commitments by the two sides. In light of these commitments, this article is an attempt to articulate some of the major differences between the two views from the vantage point of a traditional dispensationalist.
A literal interpretation of the Bible
The first major difference is that dispensationalists insist on literal interpretation of the whole Bible even when interpreting prophetic passages. Generally speaking, covenant theology waivers on prophecy, often opting for some form of allegorical interpretation. Sixty years ago this was the general consensus by both groups.  Rarely today would a proponent of covenant theology concede the point so strongly. The debate has become more sophisticated, taking into account how the person links one Bible passage to another, especially relating to the New Testament use of the Old Testament. However, the difference over literal interpretation of prophecy remains a key point to discuss.
Several observations must be made for us to fully comprehend this difference on literal interpretation.
The meaning of “literal”
To begin with, the word “literal” in the context of this debate is not always easily understood. Some take it as the opposite of figurative language. However, no dispensationalist argues that the Bible has no symbols or figurative language (e.g., the sword in Christ’s mouth in Revelation 19). Supporters of covenant theology sometimes accuse dispensationalists of being inconsistent when they insist on using a seemingly problematic term. To be sure, scholars in both camps search for other terms to use, such as “normal” or “customary.”
However, one must understand another important way that the expression “literal” is used. When we speak of “literal hermeneutics,” we are using “literal” as a technical term from the field of hermeneutics. In this sense, the word “literal” conveys the idea of grammatical-historical interpretation. Such an approach acknowledges that every passage has a language context, such as the meanings of original words in their context. This would also include contextual analysis of literary elements, genre, symbols, figures of speech, and structure of the text in question. The early church fathers often spoke of the literal sense with historical awareness. For example, they would interpret Adam and Eve in Genesis as real people in history and not as merely literary devices that stood for humankind or some other idea. In this way, the literal sense speaks of textually based meaning. Its opposite is not figurative. Its opposite is allegorical interpretation, an approach that offers a non-textual understanding of texts.
The importance of textual interpretation
The way that such non-textual understandings play out in the interpretation of prophecy in covenant theology can be illustrated well by looking at Luke 1:32 and 33 in their context. Gabriel was informing Mary about the Virgin Birth. Neither dispensationalists nor covenant interpreters deny the literal interpretation of the aspects of the overall passage that speak of the prediction and explanation of the Virgin Birth itself (vv. 26–37). However, there is a sudden shift when things about the nation of Israel and a kingdom come into focus. Verses 32 and 33 state plainly, “The Lord God will give Him the throne of His father David. And He will reign over the house of Jacob forever, and of his kingdom there will be no end.” What throne or rule is being mentioned? What does it mean to emphasize Jacob in this context? How would Mary have understood Gabriel’s statement? To take these elements at face value, following the text would naturally lead to the conclusion that Jesus would one day reign from Jerusalem on an earthly throne that is His right as a son of David. Furthermore, the reign over the house of Jacob should be understood with some national implications for Israel and its centrality for what the text describes as Jesus’ “forever” reign.
However, such Jewish aspects are denied by most covenant interpreters, who opt for a non-textual interpretation of a spiritual kingdom that has no future role for national Israel. This is done in spite of the fact that those in the narrative were Jews with national expectations. For example, one can read the older commentary by Matthew Henry and see his almost cavalier dismissal of the Jewish elements in the passage. Henry suggests that Gabriel was assuring Mary that Christ’s kingdom “shall be spiritual: he shall reign over the house of Jacob, not Israel according to the flesh, for they neither came into his interests nor did they continue long a people; it must therefore be a spiritual kingdom.” Notice the insertion of the idea “not Israel according to the flesh.” How would Mary have gleaned that understanding from the actual words spoken to her? Henry simply assumes, as do many covenant interpreters, that Israel’s rejection of Christ and subsequent removal from the land in AD 70 removed any literal and national elements from Gabriel’s words. Dispensationalists view such an explanation as quite arbitrary and non-textual.
Theological vs. analogical interpretation
A related observation is covenant theology’s tendency to interpret terms in a theological way rather than in an analogical way as dispensationalists often do. For example, covenant adherents are prone to make much of the fact that Peter used Old Testament imagery about Israel to describe the church (e.g., “chosen generation,” “royal priesthood,” “holy nation,” 1 Peter 2:9). A similar example would be the use of the word “temple” to describe the church or Christians (e.g., 1 Corinthians 3:16; 6:19) or even to describe the resurrected body of Jesus (John 2:19). Covenant scholars take such uses to mean that any national and literal promises relative to Israel’s future should be discarded in all other passages that use the word “temple” (e.g., 2 Thessalonians 2:4). Instead, they say, the development of a theology of the church is to be found anywhere and everywhere such language occurs. Dispensationalists understand such reasoning on the part of covenant interpreters to be theological rather than exegetical in nature. Rather, the passages in question are merely using language common to the Jewish culture in an analogous way that is common and expected. Thus the terms should often be understood as a simple analogy. In light of this difference, dispensationalists often view covenant theology as more deductive in nature, while they view themselves as champions for inductive Bible study.
Another related point involving literal interpretation is the way that progress of revelation factors into Bible interpretation. No one doubts the fact of the progress of revelation. The difference lies in how it affects interpretation. Dispensationalists see it as highly significant. In fact, it is strongly related to the historical part of grammatical-historical interpretation. For example, the book of Daniel needs to be interpreted as a sixth-century BC writing in language and historical context. The Pentateuch should not be interpreted as if Moses had the book of Revelation in his own personal library and in his thoughts. Dispensationalists believe that antecedent theology is important for interpretation. That is, all that has been written before a particular writing in the Bible can serve as background to any given text. However, dispensationalists strongly reject any attempt to read later revelation back into earlier revelation. History flows in only one direction. This particularly shows up in dispensationalists’ belief that the Old Testament has a measure of autonomy for its own interpretation. For a dispensationalist, the most important factor in interpreting the Old Testament text is the Old Testament text itself. Covenant adherents give the impression that the most significant factor in interpreting the Old Testament is not its own text, but the New Testament understanding of the Old Testament. Extreme forms of this approach exist in the covenant camp that would insist that someone cannot really understand any verse in the Bible until he or she has read the entire Bible. Dispensationalists reject such thinking in light of the necessity that every text has meaning for its own contemporary audience in the light of the progress of revelation.
A Distinction between Israel and the church
A second major difference between dispensationalism and covenant theology is that dispensationalists believe in a distinction between Israel and the church. This does not always mean an absolute distinction. After all, the two institutions share the same God, the coming kingdom, and the Messiah. It also does not mean that covenant theology supporters fail to see any differences between the two in history, such as a functioning nation of Israel in the Old Testament and an international church in the New Testament.
The beginning of the church. However, in the end, covenant theology really defines the church as the collection of the saved or elect. In short, the word “church” appears to be merely a soteriological category. Thus, for covenant theologians, the church began either with Adam (presumably the first saved man) or Abraham (the main starting point for God’s patriarchal plan for redemption). This is illustrated by Calvin’s statement that the Sadducees were part of the church long before the Day of Pentecost.
In contrast, dispensationalism sees the church as starting on the Day of Pentecost in Acts 2 and does not treat the word “church” as a soteriological category. Most dispensationalists, especially Baptist ones, would see the necessity of individual regeneration to be in the church. However, dispensationalists emphasize other aspects of the church’s nature and how it functions. The church has a unique relationship to Christ, something that did not exist before. Church saints are baptized into Christ or have a position of being “in Christ.” This strong identification is not true of pre-Pentecost saints.
The function of the church. In addition, God has designed the church to function in an entirely different way. Old Testament Israel was a concrete, ethnic, and political nation with civil organization, ceremonial prescriptions, an elaborate priesthood, a specific land, and even a military. Much of God’s dealings with Israel came through His relationship with the person occupying the throne at any given time. On the other hand, the church is international in scope and separate from any national entity. It was not part of the Roman government in the New Testament and has no restrictive boundaries. It operates without a king other than Jesus. It had apostles to help its establishment, and it functions today to take the Light to the world by planting churches, something unknown in the Old Testament and not part of God’s plan for that time.
Although Israel and the church share many spiritual blessings and promises, the dispensationalist is strongly committed to the fact that such sharing does not unravel any promises given to the physical descendants of Israel and does not diminish the uniqueness of the church. Both institutions play their ordained roles within history.
A consistent approach to Biblical history
The third major difference between dispensationalism and covenant theology is the contrast in approach to Biblical history. Adherents of covenant theology view Biblical history through the lens of two covenants that appear to govern their reading of the text. The first is the covenant of works with Adam in the Garden. The second and crucial one for our discussion is the covenant of grace, which spans from the Fall until the end of Biblical history. This covenant of grace is focused on individual redemption through election as the hoped-for end of all participants in the covenant. Its individualistic and soteriological focus fits much more nicely with New Testament teaching, but not with the Old Testament emphasis upon community and national promises. This is perhaps the major reason that covenant theology proponents struggle mightily with the Old Testament promises and the future of national Israel. Such promises do not fit the major theme by which they are reading the Bible. The covenant-of-grace approach usually leads to amillennialism, in contrast with dispensationalism’s premillennialism. The focus on individualism and salvation has led some to accuse covenant theology of being human-centered in spite of the fact that it contains within it much that is good about the sovereignty of God.
A multifaceted plan. Dispensationalism has a fundamentally different philosophy of Biblical history. It is true that both camps share a belief that individual redemption is a major achievement in God’s overall redemptive plan. However, dispensationalism has always emphasized the plural in God’s plan—the Biblical purposes of God in history throughout the panorama of the ages. Distinctions in that plan are allowed to stand without emphasizing any forced unity. In particular, dispensationalists have focused on God’s creation of the world, the formation of the nations, the calling of Israel out from the nations, and the birth of the church as major points along the path. The beginning point of the final redemptive push in the end-time days happens in reverse order for each, including a national future for Israel that is left out of covenant theology. Such realities as these found in the Bible force the dispensationalist to admit that God’s plan is multifaceted and not a single track with a focus on individual redemption. Acknowledging this plural in God’s purposes better gives God His due. Consequently, the dispensationalist affirms a doxological purpose for Biblical history (i.e., to praise God) more than it centers its spotlight on individualistic redemption.
More differences between dispensationalism and covenant theology could no doubt be discussed. The ones summarized here are significant because they involve hermeneutical and theological commitments on the part of each camp. While loving across the boundaries is always in style for born-again Christians, the differences should not be glossed over. In the end, the correct interpretation of God’s Word matters.
Mike Stallard (PhD, Dallas Theological Seminary) is the dean of Baptist Bible Seminary (Clarks Summit, Pa.) and a professor of systematic theology. See also Dr. Stallard’s article “The Challenge of Progressive Dispensationalism”
 This article does not attempt to deal with attempted mediating or moderating positions such as progressive dispensationalism and new covenant theology. It must be understood that covenant theology is one position within the larger world of nondispensationalism. Many of the points made in this discussion could apply to that larger world, but not all.
 Oswald T. Allis, Prophecy and the Church (Phillipsburg, NJ: Presbyterian and Reformed Publishing Co., 1945), 244; J. Dwight Pentecost, Things to Come (Grand Rapids: Zondervan, 1964), 1.
 Matthew Henry, Matthew Henry’s Commentary on the Whole Bible (McClean, VA: MacDonald, n.d.), 5:585. For a more recent covenant interpretation along the same lines, see William Hendrickson, The Gospel of Luke (Grand Rapids: Baker, 1978), 87.
 For further elaboration, see John Feinberg, “Systems of Discontinuity” in Continuity and Discontinuity, edited by John Feinberg (Westchester, IL: Crossway Books, 1988), 71–73.
 For a more complete development of this point, the reader can review my article “The Temple in the Olivet Discourse and Other New Testament Texts: A Brief Evaluation of Nondispensational Understanding of NT Temple Imagery,” The Conservative Theological Journal 9 (Dec. 2005): 370–87.
 John Calvin, Institutes of the Christian Religion, 3.25.5.
 The main points of this article are an exposition in agreement with the sine qua non for dispensationalism proposed by Charles Ryrie in Dispensationalism Today (Chicago: Moody, 1965). There is also substantial agreement with Renald Showers, There Really Is a Difference (Bellmawr, NJ: Friends of Israel, 1990).