This document describes a teacher-developed, elementary school level program that teaches conflict resolution through children's literature. This is a whole language/peace education program in which children learn creative ways to solve conflicts by reading and writing stories about conflicts. The document opens with a reproduction of the program description as it appeared in an Impact II catalog of exemplary programs developed by New York City teachers. This is followed by a brief paper entitled "Peace Education and Conflict Resolution in the Inner City," presented by the text of a speech given by Diane Shatles, who developed the program, at an international conference on reading held in London (England) in 1986. The bulk of the document presents the program itself through descriptions of lesson plans and other materials. The lesson plans are: (1) What Is a Friend?; (2) Developing the Concept of Conflict as Being a Difficult but Normal Part of Life; and (3) Conflict Resolution--Stealing. Also included are a diagram of a sample conflict web, a worksheet on "What is Conflict?", a diagram of the problem solving cycle, and other problem solving exercises. A 23-item list of appropriate children's literature grouped by theme, a 9-item resource list, and a 24-item list of useful children's books are provided. (JB)