In Islam peace is achieved through sincere acknowledgement of people’s rights and their freedom to use them as well as sincere and utmost discharge of individual and collective responsibilities. Therefore, the objective of the paper is to emphasize on the teaching of Islam towards peace and conflict resolution. The findings show that with the existence of peace in the society conflict or disagreement can be managed and subsequently resolved among the groups. It adopts both historical and analytical methods. The paper concludes and recommends that if an individual follow the Islamic teaching concerning peaceful co-existence there will be peace and mutual relationship among one another in the state.