Grace is usually defined as “unmerited favor.” By adding grace to peace, Paul made this greeting a distinctly Christian one. In saying this, we are not saying that the idea of grace was distinctly Christian and had nothing to do with the Judaism of the Old Testament. It is true that the Law played a prominent role in the Old Testament. The first five books, which serve as the foundation of the Old Testament, are called the Torah, “the Law.” God promised blessings for Israel’s obedience and curses for Israel’s disobedience (Deut. 28). In the end, Israel was kicked out of the promised land for their repeated rebellion against God and His law.
But consider how God prefaced His giving of the Law: "I am the LORD your God, who brought you out of the land of Egypt, out of the house of slavery. You shall have no other gods before me (Ex. 20:2-3). Why should the people of Israel worship and serve YHWH alone and keep His commands? Because God, by His grace, set them free from their slavery in Egypt. The Mosaic Law is placed within the context of God’s gracious work of redemption, upon the foundation of divine grace.