Out of the Protestant Reformation, from Martin Luther, came the concept of Law and Gospel. It is used to read and interpret Bible passages. Confessional Lutherans especially make a big deal out of using it. I find it to be a very helpful concept. The Law tells us what to do. The Gospel tells us what God has done and what he is doing in Christ Jesus. Primarily, the Law shows us our sin, and the Gospel shows us our Savior.
There are three functions or uses of the Law. The Curb function of the Law restrains people from doing wrong. You do not steal because it is wrong and there are consequences to stealing. The Law as a Mirror shows us who we are, sinners. It shows us our sin and how we have failed to keep the law. The third use of the Law is the Guide function. The Law shows us how to live, and how to respond to God’s saving love (the Gospel).
The Gospel shows us what God has done for us. It is Good News. It is usually focused on what Jesus has done, but any saving action by the Triune God can be considered Gospel. The main focus is on Jesus since that is the entire Bible story points to him. He came to Earth to save us and restore that broken relationship with us.
If we look at Exodus 20:1-17, we can easily find Law and Gospel. The Ten Commandments are found there but in verse two before any commandment is given we find the Gospel. God reminds them that he had saved them from Egyptian slavery. So the Gospel appears right before the giving of the Ten Commandments, the Law. Therefore these commandments told them how to respond to God who had saved them (the third use of the Law). The commandments were to restore a covenant relationship with God. The commandments unfortunately also show us how we fail to keep those commandments (the second use of the Law) and our need to be freed from the bondage of sin. And in the Ten Commandments you can also find the first use of the Law (civil laws), for example “You shall not steal”. So the uses of the Law are not mutually exclusive. These commandments are applied today telling us how to respond in gratitude to God’s saving love.
Law and Gospel can be applied to ourselves and our conversations. When a person is suffering and feeling worthless, that is when we need to share the Gospel message of God’s love for them. When a person is feeling that what they are doing is not that bad of a wrong or just not wrong, then we need to share the Law and remind them that sinning is serious and it causes harm. For unbelievers, I would first let them know that we all are not perfect and are broken sinners (Law), and then share the good news that God still loves them, broken as they may be, and desires to be in relationship with them (Gospel).