1

                                                                       Exhibit 5

                       (Pedersen & Houpt, P.C. Letterhead)

September 25, 2000

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

Gentlemen:

         This opinion is furnished in connection with the registration statement
on Form S-3 (the "Registration Statement") filed pursuant to the Securities Act
of 1933, as amended (the "Securities Act"), and the rules and regulations
thereunder, relating to the registration of the sale of 562,285 shares (the
"Shares") of common stock, $.001 par value per share, of Blue Rhino Corporation,
a Delaware corporation (the "Company"), for the respective accounts of certain
stockholders of the Company. We have acted as special counsel to the Company
with respect to the opinions set forth herein.

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

         1.       The Registration Statement;

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

         3.       The Company's Amended and Restated Bylaws; and

         4.       Resolutions of the Company's Board of Directors dated February
                  18, 2000.

We have also examined originals, or copies certified or otherwise identified to
our satisfaction, of such corporate records of the Company, certificates of
public officials, and such other documents as we have deemed relevant and
necessary 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. Notwithstanding the foregoing, we express no opinion with
respect to the blue sky or securities laws of any state, including Illinois and
Delaware.

         Based upon the foregoing, and subject to the qualifications and
limitations stated herein, we are of the opinion that the Shares have been
validly issued and are fully paid and non-assessable.

         We hereby consent to the filing of this opinion letter as an exhibit to
the Registration Statement and to the reference to us under the heading "Legal
Matters" in the prospectus that forms a part of 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.

                                                  Very truly yours,

                                                  /s/ Pedersen & Houpt,
                                                  ---------------------
                                                  a Professional Corporation