The present paper makes a case for retention of the (Revised) Alternation Condition in Lexical Phonology, a theory in which any single rule which presebts beytralizing, lexical effects restricted to derived forms along with allophonic, derivationally unterstricted dffects is cominally impossible. However, Korean obstruent palatalization does display both of these properties, whereby /t, th/ neutralize with /ĉ, ĉh/ before [i], but only if the [i] occurs in another morpheme (cf. /path + i/→ [paĉhi] ‘field-SUBJ’ vs. monomorphemic [pathi] ‘endure’), whereas / s / acquires the palatal allophone [∫[ before [i] both within ([∫i] ‘poem’) and between (/os + i/→ [o∫i] ‘cloth-SUBJ’) morphemes. The Revised Alternation Condition alone imposes just this restriction on a single palatalization rule functioning both lexically and post-lexically in Korean, which suggests that its removal from the theory is premature.