In their missionary journeys, Alma and his brethren come upon the Zoramites, who had established themselves as the chosen people of God. As part of their worship services, they cried with a loud voice, saying: "And again we thank thee, O God, that we are a chosen and a holy people." (Alma 31:18) Although the context of their worship was covenant oriented, the problem with the Zoramites was that they were worshipping "dumb idols" (see Alma 31:1) and had taken honor upon themselves.
All true "chosen" and "holy" people are the result of covenants made with the only true God. Moreover, as we find in Deuteronomy 28:8-9, it is the Lord that does the choosing and it is always conditional on obedience to his commandments: "The Lord . . . shall bless thee in the land which the Lord thy God giveth thee. The Lord shall establish thee an holy people unto himself, as he hath sworn unto thee, if thou shalt keep the commandments of the Lord thy God, and walk in his ways."
According to Blair Van Dyke, the word holy is a translation from the Hebrew qodhesh, which means sacred, undefiled, and set apart. We see the significance of this in Deuteronomy when Moses says:
The Lord hath avouched thee this day to be his peculiar people, as he hath promised thee, and that thou shouldest keep all his commandments; and to make thee high above all nations which he hath made, in praise, and in name, and in honour; and that thou mayest be an holy people unto the Lord thy God, as he hath spoken (Deuteronomy 26:18-19).
Interestingly, the word peculiar is a translation from the Hebrew word segullah and means personal property rather than something unusual or unique. As used in the Old Testament, segullah generally suggests the image of covenant Israelites being the personal treasure of Jehovah, bought by him. They are like priceless jewels that are carefully guarded and cared for in a special fashion. [Blair G. Van Dyke, "Profiles of a Covenant People," in Covenants Prophecies and Hymns of the Old Testament, p. 39]