The Day of the Lord is a common refrain among the minor prophets and it is repeated in Obadiah. This is either a great day or a fearful day depending on what side one is on. While the first part of Obadiah warns of Edom’s destruction, the Day of the Lord will bring about judgment upon all nations. Each one will be judged according to their deeds – “as you have done, it will be done to you.”
On the other hand, the Day of the Lord is to be a day of rejoicing for all of the faithful. From our modern Christian perspective, this day might be the day of Christ’s Second Coming, or it might be the final judgment when believers receive their rewards while the wicked are punished. From the Old Testament perspective however, this is simply looking forward to a day when Israel would one day be restored. Those who believe in a literal Millennial Kingdom will find the fulfillment of this prophecy to be literal when Jesus reigns on the throne of David. For those who believe the Millennial Kingdom is figurative or is current in the church age, this prophecy must be fulfilled figuratively within the church.
No matter which way one interprets prophecy, literal is best when feasible in our opinion, the Day of the Lord is good news for believers and bad news for the wicked. Not only will Edom receive punishment for its sins but so will every wicked nation and the wicked people from those nations. The righteous will enjoy the kingdom of the Lord however and they will receive their long awaited reward.