When the Bible talks about someone being holy, it means that person is set apart as belonging to God. Since God is the embodiment of purity, those set apart to Him must also be pure. This standard of purity is an ever-present reminder to us of God’s holiness. Israel was to be a “holy people,” set apart as His own possession.
God provided the means by which they could live a righteous life through the Law. The only problem is that Israel habitually fell short of keeping God’s law. Yet given what we know about human nature, how could it have turned out different? The Law was merely a “shadow” of what was to be fulfilled through Jesus. It pointed toward God’s supreme purpose which remained shrouded in mystery until Christ’s coming. What God ultimately had in mind was to impute His own righteousness to us apart from the Law.