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Social interactions do not occur in a vacuum. They often take place in groups and social networks where people can monitor and spread each other’s reputation. Despite the temptation to act selfishly when interacting with strangers, there is a never-ending conflict between the desire to act selfishly and the need to gain a good reputation (or avoid losing the good reputation one already has). While one’s selfish behavior guarantees immediate material benefits, it may harm one’s reputation and can lead to a long-term loss. Thus, reputation is a key element of indirect reciprocity that provides a fundamental route to human cooperation. In this chapter, we have discussed how reputation is formed and assessed in social interactions, reviewed empirical research that documents the phenomena of indirect reciprocity and reputation-based cooperation as well as evidence about the greater power of reputation over monetary …