How can Antigone be seen as an allegory for the individual and the state?

Antigone herself represents the individual and Creon represents the state. The state claims to have the common good as its interest, when in reality it is easy for it to become quite self-serving as we see with Creon's edict that the rebels not be given proper burial, even though this goes against ancient Greek moral law. Antigone represents the individual with a conscience that commands her to act against the state, whose edict she sees as immoral and irreligious. Her act of civil disobedience is a criticism of the state itself and this gets her into trouble.
When Creon condemns Antigone to death for following her conscience, he is oppressing the individual's right to conscience. However, the state itself is injured when the individual is denied rights, as we see with Creon's loss of his son and wife as a result of his actions. He loses his own humanity in the process of trying to over-impose order.
The play then argues for a balance between the needs of the individual and the needs of the state. The state can only be effective if it is in dialogue with individuals and acting morally.

Antigone can be seen as an allegory for the individual vs. the state. The "state" is systemic power held by an institution. Antigone is representative of the individual heroine, while Creon is representative of institutional power. Their struggle against each other and their ultimate tragic fates show that while the state can crush the individual because of power differentials, the moral order can only be restored by the thoughtful, rightful resistance of individuals within a state.