Human ethnocentrism--the tendency to view one's group as centrally important and superior to other groups--creates intergroup bias that fuels prejudice, xenophobia, and intergroup violence. Grounded in the idea that ethnocentrism also facilitates within-group trust, cooperation, and coordination, we conjecture that ethnocentrism may be modulated by brain oxytocin, a peptide shown to promote cooperation among in-group members. In double-blind, placebo-controlled designs, males self-administered oxytocin or placebo and privately performed computer-guided tasks to gauge different manifestations of ethnocentric in-group favoritism as well as out-group derogation. Experiments 1 and 2 used the Implicit Association Test to assess in-group favoritism and out-group derogation. Experiment 3 used the infrahumanization task to assess the extent to which humans ascribe secondary, uniquely human emotions to their in-group and to an out-group. Experiments 4 and 5 confronted participants with the option to save the life of a larger collective by sacrificing one individual, nominated as in-group or as out-group. Results show that oxytocin creates intergroup bias because oxytocin motivates in-group favoritism and, to a lesser extent, out-group derogation. These findings call into question the view of oxytocin as an indiscriminate "love drug" or "cuddle chemical" and suggest that oxytocin has a role in the emergence of intergroup conflict and violence.