Originates from the slang words 'ill' and 'legit'. When these two words combine they form 'ill legit'. Also based on the slang developed by The Beastie Boys (although they never in fact used these two words in combination). Could appropriately be used when someone does something very impressive but not only is this 'something' they do impressive but it is done with complete and utter style.
1. (Your friend does an extremely smooth 180 degree rollout over a box on his 20" bike) you say "Damn... that was ill legit"
2. (Your friend pulls out an electric guitar and instead of playing some retarded-ass solo, that does take talent but sounds horrible, he plays some cool, slick classical/spanish guitar riff) "WOW! ILL LEGIT... thats all i can say about that"