This article seeks to explore the "two faces of education" through a critical analysis of peace education in Sri Lanka. It aims to contribute to the wider debate on the complex role of education in situations of conflict. The article starts with an overview of what peace education is, or should be. This leads to the conclusion that peace education cannot succeed in isolation, and needs to be incorporated in a multilevel process of peacebuilding. Further analysis draws from Bush & Saltarelli's notion of the "two faces of education", combined with Lynn Davies's notion of "war education". These notions help to explain to what extent (peace) education in Sri Lanka contributes to positive or negative conflict, or, in other words, which one of the two "faces" is most prominent. The positive side of education is employed through inter-group encounters, the stimulation of self-esteem and a "peaceful school environment". Through dialogue and understanding, these initiatives stimulate a desegregation of a very segregated school system and society. However, these positive initiatives remain limited. Other, more structural issues, tend to work towards the negative face of education, by fostering segregation, fear and bias rather than counteracting them. These issues form pressing challenges for peace educators and policy makers in Sri Lanka. Critically informed research and evaluation should provide guidelines for well-thought through peace education initiatives, by working towards a combination of critical theory and problem-solving approaches to deliver both critical and hands-on guidelines for further peace education initiatives. (Contains 1 figure, 1 table and 8 notes.)