The reported rise in radicalism among youth in Pakistan since 9/11/2001 has been attributed to religious education in "madrasas" and schools. However, education in Pakistan is only part of the historical and contemporary forces that contribute to the prevailing exclusivist religio-political discourse. Although most policy papers have recommended a secularization of public education, such efforts by the Pakistani Government have been counterproductive. These efforts by the Pakistani Government to reshape education, with massive funding from international donors, have faced strong opposition and there are signs of psychological reactance as evidenced by even greater levels of religious radicalism among Pakistani youth. The current study suggests a viable alternative for reshaping education in Pakistan. A nationwide survey of educated urban youth (N = 386) conducted by the first author, revealed that when considering radical religious, Western secular and liberal religious ideas, Pakistani youth were overwhelmingly supportive of a liberal religious approach to education that highlights an inclusive Islam emphasizing freedom and compassion. Findings have implications for Government reforms, peace education initiatives and long-term conflict transformation in Pakistan.