Exhibit 5.1

                    LEGAL OPINION OF PEDERSEN & HOUPT, P.C.

                      (Pedersen & Houpt, P.C. Letterhead)

                               January 3, 2000

Blue Rhino Corporation
104 Cambridge Plaza Drive
Winston Salem, North Carolina 27104

Gentlemen:

     We have acted as counsel to Blue Rhino Corporation, a Delaware corporation
(the "Company"), in connection with the preparation of a Registration Statement
on Form  S-8 (the "Registration Statement"), which has been filed by the Company
with the Securities and Exchange Commission for the purpose of registering under
the Securities Act of 1933, as amended (the "Securities Act"), and the rules and
regulations thereunder the sale of up to 300,000 shares (the "Shares") of the
Company's Common Stock, $.001 par value per share, upon the exercise of options
granted under the Blue Rhino Corporation Employee Stock Purchase Plan (the
"Plan").

     Before rendering the opinions hereinafter set forth, we examined, among
other things:

     1.   The Registration Statement;

     2.   The Plan;

     3.   The Company's Second Amended and Restated Certificate of
          Incorporation;

     4.   The Certificate of Amendment to the Company's Second Amended and
          Restated Certificate of Incorporation;

     5.   The Company's Amended and Restated Bylaws;

     6.   Resolutions of the Company's Board of Directors; and

originals or photostatic or certified copies of all those corporate records of
the Company and of all those agreements, communications and other


January 3, 2000
Page 2



instruments, certificates of public officials, certificates of corporate
officials and such other documents as we have deemed relevant and necessary as a
basis for the opinions hereinafter set forth. As to factual matters known to the
Company, we have relied without investigation, to the extent we deem such
reliance proper, upon certificates or representations made by the Company's duly
authorized representatives.

     We are members of the Bar of the State of Illinois, and we express no
opinion with respect to laws other than the laws of the State of Illinois, the
General Corporation Law of the State of Delaware and federal laws of the United
States of America.

     Based upon the foregoing, and subject to the qualifications and limitations
stated herein, we are of the opinion that when (i) the Registration Statement
becomes effective under the Securities Act and (ii) the stock purchase rights
issued pursuant to the Plan have been duly exercised pursuant to the terms of
the Plan that the Shares will be validly issued, fully paid and non-assessable.

     We hereby consent to the filing of this opinion letter as an exhibit to the
Registration Statement. In giving this consent, we do not hereby admit that we
are within the category of persons whose consent is required under Section 7 of
the Securities Act and the rules and regulations of the Securities and Exchange
Commission promulgated thereunder.



                                /s/ Pedersen & Houpt, a Professional Corporation