Provides Communications Alternative for Small and Medium-Sized Businesses

SEATTLE, June 15, 2000 - Small and medium-sized businesses, often neglected by the major telecommunications providers, have a new voice in Seattle. With initiation of Allegiance Telecom, Inc. (Nasdaq: ALGX) service in Seattle and Bellevue, local businesses can enjoy levels of service previously only available to large corporations. Allegiance is targeting small and medium-sized businesses in the Seattle area, providing economical local, long distance, international calling, high-speed data transmission and Internet services.

Allegiance is a facilities-based competitive local exchange carrier (CLEC), offering businesses a complete package of telecommunications services. The company is targeting 36 major metropolitan areas in the United States with its "one-stop shopping" approach. Allegiance Telecom is currently operational in 22 other markets, including Atlanta, Baltimore, Boston, Chicago, Cleveland, Dallas, Denver, Detroit, Fort Worth, Houston, Long Island, Los Angeles, New York, Northern New Jersey, Oakland, Orange County, Philadelphia, St. Louis, San Diego, San Francisco, San Jose and Washington D.C.

"Telecommunications services, from basic local dial tone to high speed Internet access and e-commerce applications, are vitally important to business owners in Seattle," said Tony Parella, Allegiance Telecom senior vice president of sales and customer care. "Allegiance brings competition to the local marketplace, providing an economical single source for these business telecommunication requirements, all consolidated on one bill."

Parella noted the new Allegiance Telecom office will be headed by Robb Schiemann, a veteran Allegiance salesperson who has been promoted to Seattle city vice president from Houston.

Allegiance Telecom's new local sales office is located at 15500 S.E. 30th Place, #202, Bellevue, WA, 98004, and can be reached via telephone, 425/378-3600.

Allegiance is a facilities-based competitive local exchange carrier headquartered in Dallas, Texas. The Company's web address is www.allegiancetele.com. Allegiance's common stock is traded on the Nasdaq National Market under the symbol ALGX.