Alignment is a key factor in this game and represents your standing with the Galactic Federation. When you begin the game, you start with zero alignment. You can enter your race's Headquarters and choose to "become a Deputy". In doing this, your alignment is set to 150. Your alignment will go up and down throughout the game and it can be difficult to maintain a positive alignment. Some players choose to join the Underground (also known as "Going Evil"), which sets your alignment to -150. Some players will tell you that going evil is more difficult of a task, as when you are trading illegal goods you take the chance of being caught. When you get caught, you have to pay a hefty fine. Your alignment goes down faster this way, but requires a lot of money to do so.
You need at least 100 alignment to buy Federal ships, or -100 to purchase Underground ships.
Alignment also plays a role in how many weapons you may safely have on your ship and still receive Federal Protection.