It's my belief that, whilst there are some that use it with the best of intentions, I'm not convinced that collectively we understand what we mean by this term. Sometimes I get the impression that it's used politically; that is, in order for someone to be seen to use today's "buzz" term and so give the impression that they're in with the "holy crowd". Other times, those who use this term give the impression that it's just about moralism or legalism - living a good life, because that's what God wants of us. Of course, that's good, but is that what holiness really is?

For me, as I read more and more about this very important term, and wrestle with coming to terms with what it means to be holy in the real world, I'm convinced that at times the term is used in such a way that it is disconnected from God himself. This is a huge problem since God himself is holy, and thus the source of all holiness. A disconnected holiness, however, is not holiness at all. Here's why.
You see early in the Scriptural narrative we read of God's holiness which results in him unapproachable by a sinful people (e.g. Exodus 19). At the same time, though this unapproachable God is forming a people for himself, so that he may dwell in their midst. This is represented by the Tent of Meeting, the Tabernacle, and later the Temple in the Hebrew Scriptures. God is both the "Holy One of Israel" and the "Holy One of Israel" (e.g. Isaiah 1:4). That is, he is holy (unapproachable) yet in relationship with a people (dwelling amongst them). By virtue of that relationship, though, the people themselves become a "royal priesthood and a holy nation". Their holiness stems only from their relationship with the holy God. They are not holy because of their following the regulations set down in the law. Rather they are God's holy people and thus follow the regulations in response to his holy character and call.
When we come to the New Testament, however, we see that the dwelling place of God is no longer represented by the Temple, but by a person - Jesus Christ. God himself, who "tabernacles" amongst us (John 1:14). The God-man - perfectly divine and perfectly human uniting the two natures, once separated by sin, now have become inseparably holy. This is the miracle of the "incarnation" and it is this that makes the work that Christ achieved, his "atonement", effective. That which we believe by faith about who Christ is as the God-man enables us to believe by faith what Christ has done as the God-man - his conception, birth, life, suffering and death, resurrection, ascension and glorification. The entire "Christ event", Incarnation and Atonement together, are vital for Christian life and faith.
The same is true for Christian holiness.
We need a solid and broad understanding of what has actually happened as a result of God himself taking on human nature in Jesus Christ. By this very action of God toward humanity he sanctified it enabling humanity to respond. At one and the same time, however, the vicarious action of man toward God through the representative human, Jesus, is that perfect and sinless response to God. On behalf of humanity, Jesus Christ accepts the guilty verdict, confesses sin, repents, suffers and dies and thus sanctifies humanity by this action.
So what do we have to do?
Well our response is to adopt Christ's response. That is, Jesus responded on our behalf, and his perfect response was effective, once and for all. We are invited, by grace through faith, to respond to that perfect response. We are enabled to do this through the Holy Spirit and by virtue of the belief that human nature has been sanctified by God's presence within it through Christ when he took that human nature on.

This is where it gets exciting, though (well... at least for me it does). Christ's response on our behalf, which we subsequently respond to, is much more than just an intellectual assent to a message about God. It's more than just saying "Yes, I believe" and then praying some preformulated "sinner's prayer". Christ's response enables union with God. This is what Jesus himself promised (John 15). This is what Paul talks about with his language of being "in Christ" (e.g. Romans 8:1). So too, the author of 2 Peter uses a unique phrase, but one which conveys the same idea: "participants in the divine nature" (2 Peter 1:4).
Think on this... the Father makes a move toward us in Christ, through the Holy Spirit. This move sanctifies humanity. Then, by that same Spirit, Christ, the God-man, responds effectively on our behalf to the Father. This response, then, is a holy and human response. As we then respond to Christ's response we a drawn into the Godhead itself. Here's how it's expressed in Colossians 3:3 "For you died, and your life is now hidden with Christ in God"
So to get back to my original point (there was one wasn't there???), to talk of holiness apart from a relationship with God is anathema. It doesn't make sense and is actually not holiness at all. At best it's humanistic moralism.
God is holy and when he says "be holy as I am holy" (1 Peter 1:16) it is both a gift and a command. It is God (the holy one) giving his holiness to his people (in relationship) and calling them to live within that holiness.
Therefore the Scriptural call to holiness in the 21st Century is a call to participate in God's holiness, made available through the Incarnate God-man and atoning sacrifice Jesus Christ, by the power of the Holy Spirit. And, so...
"Be holy, as I am holy"