EXHIBIT 5.1

             OPINION OF DILL DILL CARR STONBRAKER & HUTCHINGS, P.C.







[LETTERHEAD OF DILL DILL CARR STONBRAKER & HUTCHINGS, PC]
                                                             Christopher W. Carr
                                                                  Daniel W. Carr
                                                                  John J. Coates
                                                                 Kevin M. Coates
                                                                    H. Alan Dill
455 Sherman Street, Suite 300                                     Robert A. Dill
Denver, Colorado 80203                                            Thomas M. Dunn
Phone: 303-777-3737                                            John A. Hutchings
Fax: 303-777-3823                                                 Stephen M. Lee
www.dillanddill.com                                            Fay M. Matsukage*
                                                             Robert S. McCormack
                                                                  Adam P. Stapen
                                                                  Jon Stonbraker
                                                               Patrick D. Tooley
                                                        *Also licensed in Nevada



September 12, 2006



Galaxy Energy Corporation
1331 - 17th Street, Suite 1050
Denver, Colorado 80202

Re:      Registration Statement on Form S-3

Ladies and Gentlemen:

As counsel for your company, we have reviewed your Articles of Incorporation,
Bylaws, and such other corporate records, documents, and proceedings and such
questions of law, as we have deemed relevant for the purpose of this opinion.

We have also examined the Registration Statement of your company on Form S-3,
which is to be transmitted for filing with the Securities and Exchange
Commission (the "Commission") on September 12, 2006, covering the registration
under the Securities Act of 1933, as amended, of 28,260,205 shares of Common
Stock issuable upon conversion of outstanding convertible notes, convertible
debentures, and warrants, including the exhibits and form of prospectus (the
"Prospectus") filed therewith.

On the basis of such examination, we are of the opinion that:

1.       Galaxy Energy Corporation (the "Company") is a corporation duly
         organized, validly existing, and in good standing under the laws of the
         State of Colorado with all requisite corporate power and authority to
         own, lease, license, and use its properties and assets and to carry on
         the businesses in which it is now engaged.

2.       The Company has an authorized capitalization as set forth in the
         Prospectus.

3.       The shares of Common Stock of the Company to be issued upon conversion
         of the outstanding convertible notes and convertible debentures are
         validly authorized and when such notes and debentures are converted in
         accordance with their terms, the shares of Common Stock so issuable
         upon conversion will be validly issued as fully paid and nonassessable
         shares of Common Stock of the Company.




Galaxy Energy Corporation
September 12, 2006
Page 2




4.       The shares of Common Stock of the Company to be issued upon the
         exercise of the warrants are validly authorized and when the warrants
         are exercised in accordance with their terms, the shares of Common
         Stock so issuable upon exercise will be validly issued as fully paid
         and nonassessable shares of Common Stock of the Company.

We hereby consent to the use of our name in the Registration Statement and
Prospectus in the section captioned "Legal Matters," and we also consent to the
filing of this opinion as an exhibit thereto. In giving this consent, we do not
thereby admit that we are within the category of persons whose consent is
required under Section 7 of the Securities Act of 1933 or the rules and
regulations of the Commission thereunder.

Very truly yours,

/s/ DILL DILL CARR STONBRAKER & HUTCHINGS, P.C.

Dill Dill Carr Stonbraker & Hutchings, P.C.