How large?
If it's a couple of megabytes, then try just using Split and Sort:
Stopwatch sw = new Stopwatch();
sw.Start();
string s = File.ReadAllText(@"D:\Temp\MyText.txt");
string[] data = s.Split(' ', '\n');
Array.Sort(data);
sw.Stop();
Console.WriteLine(sw.ElapsedMilliseconds);
Took less than 1.5 seconds for 1.6MB of text, comprising 322,842 words.
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