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Why do people cooperate? We address this classic question by analyzing and discussing the role of reputation: people cooperate to maintain a positive reputation in their social environment. Reputation is a key element fueling a system of indirect reciprocity, where cooperators establish a good reputation and are thus more likely to receive future benefits from third parties. The tendencies to monitor, spread, and manage each other's reputation help explain the abundance of human cooperation with unrelated strangers. We review research on the phenomenon of reputation‐based cooperation in the domains of how people manage their reputation in response to varying cues of reputation, when reputation can promote cooperation, and individual differences in reputation management. We also propose three directions for future research: group stability and reputation‐based cooperation, solutions to cope with noise …