The 20-year-old has enjoyed an incredible first season in the Premier League.
Despite playing in his first season in the Premier League, the 20-year-old has been sensational for Mauricio Pochettino's men and has been a key reason why they still find themselves in the title picture with just three games to go.
And while Davids - who enjoyed a spell at White Hart Lane during the latter stages of his playing career - agreed that Alli has been hugely impressive this term, he warned that he may go through poor patches of form in future. And the Dutchman suggested that slating him during those difficult times will do more harm than good.
"Alli has been really unbelievable this year and it's important now to nourish this talent and not kill it," he told the Star.
"How many games has he had to play this year - between England and Tottenham? 52? That’s harsh for a young man. It's pressure.
"And if you play Champions League football next season and combine that with being an England international and a Premier League regular, you will get it hard.
"I'm worried also about how the press will react to him if at some stage next season he's not doing well and just doing okay. If you don't give the kid time and start hammering him, then that will be an issue."
What appears to have been an important factor behind why Alli has been able to score 10 goals and contribute nine assists for Spurs this season has been the confidence that Pochettino has had in his players just to allow them to play their natural game, and use the squad unity to help create the shape that has made them so difficult to beat this term.
And if the Argentinian is able to keep instilling that belief in his squad, then it may not matter too much what outsiders make of Alli's performances, though Davids' point that fans should not raise expectations too quickly is certainly valid if the attacking midfielder hopes to take the club right to the top.