The concept of identity is a cornerstone in the thinking of the great psychosocial theorist, Erik Erikson. In the epigraph above, Erikson writes of one central aspect of identity, rooted in "tribal psychology," that is based on association with human subgroups. Identification with such subgroups rather than with the human group as a whole is what Erikson refers to as pseudospeciation, and it is so powerful that it can, as Erikson laments, produce atrocities and brutality that are collectively known as "man's inhumanity to man." Genocidal movements such as Nazism represent the most virulent form of such inhumanity, but physical and psychological cruelty on the part of one group toward those perceived as outsiders is a commonplace (if not ubiquitous) aspect of human culture (cf. LeVine and Campbell, 1972). In this article, the consequences of group identification for cooperation within and between social groups will be explored. Research evidence will be reviewed that makes it abundantly clear that pseudospeciation of the sort described by Erikson is a two-edged sword. On the one hand, it promotes cooperation within social groups, overpowering the selfish interests of individuals in favor of collective interests. On the other hand, it inhibits cooperation between groups, and indeed, it fosters conflict and mistrust. Although other aspects of identity undoubtedly can affect the tendency to be cooperative (e.g., role status within a hierarchical group structure, Messé, Kerr, and Sattler, in press), the focus here will be on identity based on group membership per se. After reviewing work documenting the impact of group identity on cooperative and competitive behavior, implications for the promotion of intergroup harmony will be discussed.