Many people have a mistaken notion that a dispensation is a period of time. This is not so, however, for the word “dispense” means simply “to deal out”. The word “dispensation”, then, means “the act of dispensing or dealing out”, or “that which is dispensed or dealt out”.
The word “dispensation” is used many times in the Bible, although it is not always translated the same way. In Ephesians 3:2, Paul writes of “the dispensation of the grace of God, which is given me to you-ward”. God had committed to him the wonderful message of grace to dispense to others. Thus we read in Acts 20:24 his stirring words, spoken in the face of persecution and death:
“But none of these things move me, neither count I my life dear unto myself, so that I might finish my course with joy, AND THE MINISTRY WHICH I HAVE RECEIVED OF THE LORD JESUS, TO TESTIFY THE GOSPEL OF THE GRACE OF GOD.”
The “gospel” or “good news” of the grace of God: This was the dispensation committed to Paul for us by the risen, ascended Lord. This is always Paul’s message.
“Where sin abounded GRACE did much more abound…the forgiveness of sins, according to the riches of His GRACE…” (Rom. 5:20; Eph.1:7). source