We report a series of experiments carried out with Palestinian and Israeli participants showing that violent opposition to compromise over issues considered sacred is (i) increased by offering material incentives to compromise but (ii) decreased when the adversary makes symbolic compromises over their own sacred values. These results demonstrate some of the unique properties of reasoning and decision-making over sacred values. We show that the use of material incentives to promote the peaceful resolution of political and cultural conflicts may backfire when adversaries treat contested issues as sacred values.