This paper analyzes the long-term historical consequences of religious conflict that occurred during the period between the Augsburg Treaty (1555) and the Westphalian Peace (1648). We show that religiously divided communities that experienced the Catholic counter-reform faced relatively stronger demand for legal mechanisms of conflict resolution and developed distinct institutions of inter-religious mediation. We demonstrate that the creation of these institutions and the legalization of the religious conflict has a persistent effect to the present: citizens in localities that experienced counter-reform have a higher tolerance today. We document the persistent effects across a variety of survey-based and behavioral measures of tolerance.