Taken from the Dungeon Master’s Guide for Advanced Dungeons & Dragons, 1st edition.
Alignment describes the broad ethos of thinking, reasoning creatures - those unintelligent sorts being placed within the neutral area because they are totally uncaring. Note that alignment does not necessarily dictate religious persuasion, although many religious beliefs will dictate alignment. As explained under ALIGNMENT LANGUAGES (q.v.) this aspect of alignment is not the major consideration. The overall behavior of the character (or creature) is delineated by alignment, or, in the case of player characters, behavior determines actual alignment. Therefore, besides defining the general tendencies of creatures, it also groups creatures into mutually acceptable or at least non-hostile divisions. This is not to say that groups of similarly aligned creatures cannot be opposed or even mortal enemies. Two nations, for example, with rulers of lawful good alignment can be at war. Bands of orcs can hate each other. But the former would possibly cease their war to oppose a massive invasion of orcs. just as the latter would make common cause against the lawful good men. Thus, alignment describes the world view of creatures and helps to define what their actions, reactions, and purposes will be. It likewise causes a player character to choose an ethos which is appropriate to his or her profession, and alignment also aids players in the definition and role approach of their respective game personae. With the usefulness of alignment determined, definition of the divisions is necessary.
Major Divisions:
There are two major divisions of four opposite points of view. All four are not mutually exclusive, although each pair is mutually opposed.
Law And Chaos: The opposition here is between organized groups and individuals. That is, law dictates that order and organization is necessary and desirable, while chaos holds to the opposite view. Law generally supports the group as more important than the individual, while chaos promotes the individual over the group.
Good And Evil: Basically stated, the tenets of good are human rights, or in the case of AD&D, creature rights. Each creature is entitled to life, relative freedom, and the prospect of happiness. Cruelty and suffering are undesirable. Evil, on the other hand, does not concern itself with rights or happiness; purpose is the determinant.
There can never exist a lawful chaos or on evil good. These, and their reverses, are dichotomous. This is not to say that they cannot exist in the same character or creature if it is insane or controlled by another entity, but as general divisions they are mutually exclusive pairs. Consider also the alignment graph. If law is opposed to chaos, and good to evil, then the radically opposed alignments are lawful neutral — chaotic neutral, neutral good — neutral evil, lawful good — chaotic evil, and lawful evil — chaotic good. Lawful groups might, for example, combine to put down some chaotic threat, for example, just as readily as good groups would combine to suppress some powerful evil. Basic understanding and agreement, however, is within the general specific alignment, i.e. one of the nine categories. These are defined as follows:
NEUTRALITY: Absolute, or true, neutral creatures view everything which exists as an integral, necessary port or function of the entire cosmos. Each thing exists as a part of the whole, one as a check or balance to the other, with life necessary for death, happiness for suffering, good for evil, order far chaos, and vice versa. Nothing must ever become predominant or out of balance. Within this noturalistic ethos, humankind serves a role also, just as all other creatures do. They may be more or less important, but the neutral does not concern himself or herself with these considerations except where it is positively determined that the balance is threatened. Absolute neutrality is in the central or fulcrum position quite logically, as the neutral sees all other alignments as parts of a necessary whole. This alignment is the narrowest in scope.
NEUTRAL GOOD: Creatures of this alignment see the cosmos as a place where law and chaos are merely tools to use in bringing life, happiness, and prosperity to all deserving creatures. Order is not good unless it brings this to all; neither is randomness and total freedom desirable if it does not bring such good.
NEUTRAL EVIL: Similar to the neutral good alignment, that of neutral evil holds that neither groups nor individuals have great meaning. This ethos holds that seeking to promote weal for all actually brings woe to the truly deserving. Natural forces which are meant to cull out the weak and stupid are artificially suppressed by so-called good, and the fittest are wrongfully held back, so whatever means are expedient can be used by the powerful to gain and maintain their dominance, without concern for anything.
LAWFUL GOOD: Creatures of lawful good alignment view the cosmos with varying degrees of lawfulness or desire for good. They are convinced that order and law are absolutely necessary to assure good, and that good is best defined as whatever brings the most benefit to the greater number of decent, thinking creatures and the least woe to the rest.
LAWFUL NEUTRAL: It is the view of this alignment that law and order give purpose and meaning to everything. Without regimentation and strict definition, there would be no purpose in the cosmos. Therefore, whether a law is good or evil is of no import as long as it brings order and meaning.
LAWFUL EVIL: Obviously, all order is not good, nor are all laws beneficial. Lawful evil creatures consider order as the means by which each group is properly placed in the cosmos, from lowest to highest, strongest first, weakest last. Good is seen as an excuse to promote the mediocrity of the whole and suppress the better and more capable, while lawful evilness allows each group to structure itself and fix its place as compared to others, serving the stronger but being served by the weaker.
CHAOTIC GOOD: To the chaotic good individual, freedom and independence are as important to life and happiness. The ethos views this freedom as the only means by which each creature can achieve true satisfaction and happiness. Law, order, social forms, and anything else which tends to restrict or abridge individual freedom is wrong, and each individual is capable of achieving self-realization and prosperity through himself, herself, or itself.
CHAOTIC NEUTRAL: This view of the cosmos holds that absolute freedom is necessary. Whether the individual exercising such freedom chooses to do good or evil is of no concern. After all, life itself is law and order, so death is a desirable end. Therefore, life can only be justified as a tool by which order is combatted,and in the end it too will pass into entropy.
CHAOTIC EVIL: The chaotic evil creature holds that individual freedom and choice is important, and that other individuals and their freedoms are unimportant if they cannot be held by the individuals through their own strength and merit. Thus, law and order tends to promote not individuals but groups, and groups suppress individual volition and success.
Each of these cases for alignment is, of course, stated rather simplistically and ideally, for philosophical and moral reasonings are completely subjective according to the acculturation of the individual. You, as Dungeon Master, must establish the meanings and boundaries of law and order as opposed to chaos and anarchy, as well as the divisions between right and good as opposed to hurtful and evil. Lawful societies will tend to be highly structured, rigid, well-policed and bureaucratic hierarchical. Class, rank, position,and precedence will be important, so they will be strictly defined and adhered to. On the other hand, chaotic areas will have little government and few social distinctions. The governed will give their consent to government, acknowledging leaders as equals serving those who allowed them to assume leadership. Obedience and service in a chaotic society is given only by those desiring to do so, or by dint of some persuasion, never by requirement.