To be "set apart" is to be sanctified. Holy, consecrated, and hallowed are synonyms for sanctified. Things are "sanctified" in the Bible, such as Mt. Sinai (Exodus 19:23) and gifts to the temple (Matthew 23:17); days are "sanctified," such as the Sabbath (Exodus 20:8); names are "sanctified," such as God's (Matthew 6:9); and people are "sanctified," such as the Israelites (Leviticus 20:7–8) and Christians are "sanctified" (Ephesians 5:26).
When something is sanctified, it is designated for a specific purpose. For the giving of the Law, Sinai was set apart from all other mountains. "I have chosen and consecrated this temple so that my Name may be there forever," God said of the temple in Jerusalem, which was set apart from all other places for worship of the one true God: "I have chosen and consecrated this temple so that my Name may be there forever." My eyes and heart will never leave you" (2 Chronicles 7:16).
Things that have been sanctified should only be used for God's purposes and not for everyday tasks. King Belshazzar "gave orders to bring in the gold and silver goblets... from the temple in Jerusalem, so that the king and his nobles, his wives and his concubines might drink from them" on the night Babylon fell (Daniel 5:2). Belshazzar was killed that night by the invading Persians, so it was one of his final acts. God's name is "hallowed" (Luke 11:2), and any use of it that is casual or disrespectful is profane.
In John 17:19, Jesus refers to Himself as being sanctified, which means that He is holy and "set apart" from sin. His followers are to be set apart from sin and for God's use in the same way (see 1 Peter 1:16).
People who have been sanctified have been reborn and are thus members of God's family (Hebrews 2:11). They have been set aside for God's use. They are aware of "the Spirit's sanctifying work" in their lives (1 Peter 1:2). They do not engage in sexual immorality (1 Thessalonians 4:3). They're aware that they've been "called to be his holy people" (1 Corinthians 1:2).
Being sanctified implies that God has intervened in our lives. The blood of a sacrifice was required to set things apart for God under the Old Testament Law: "In fact, the law requires that nearly everything be cleansed with blood" (Hebrews 9:22). Blood was splattered on the tabernacle, priestly robes, and the people. Nothing was considered holy unless it had come into contact with blood. This was a picture of Christ's blood being applied spiritually for our salvation—we are "sprinkled with his blood" (1 Peter 1:2). Our bodies, as temples of the Holy Spirit, are sanctified for God's holy purposes, just as the ancient temple was (1 Corinthians 6:19).
To be sanctified, we must have been affected by God's Word. God cleanses and sanctifies us "through the word" (Ephesians 5:26; John 17:17).