DALLAS, July 25, 2003 - Allegiance Telecom, Inc. (OTC: ALGXQ.OB), a facilities-based national local exchange carrier (NLEC), announced postponement of the Company's annual stockholders' meeting, originally scheduled for July 29, 2003. A new date for the stockholders' meeting will be determined and announced in the future.

Allegiance Telecom is currently pursuing financial restructuring plans under Chapter 11 of the U.S. Bankruptcy Code, as previously announced on May 14, 2003. The Company continues to conduct business as usual -- offering high-quality, reliable telecommunications services to its customers in major markets across the United States.

The bankruptcy filings were made in the U.S. Bankruptcy Court in the Southern District of New York. The Company's bankruptcy case number is 03-13057(RDD) and its Bankruptcy Court filings are available via the court's website, at www.nysb.uscourts.gov. Please note that a PACER password is required to access documents on the Bankruptcy Court's website.

Additional information regarding the Company's reorganization is available at www.algx.com/restructuring.

Allegiance Telecom is a facilities-based national integrated communications provider headquartered in Dallas, Texas. As the leader in competitive local service for medium and small businesses, Allegiance offers "One source for business telecom^TM" - a complete package of telecommunications services, including local, long distance, international calling, high-speed data transmission and Internet services and a full suite of customer premise communications equipment and service offerings. Allegiance serves major metropolitan areas in the U.S. with its single source provider approach.