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Conflicts of interest are part and parcel of living in a social group, yet actual conflict can be rare in established groups. Within limits, individuals can maximize the benefits of group living by resolving conflict with other group members. Thus, understanding what causes conflict, what determines its outcome, and how it is resolved holds the key to understanding the evolution and maintenance of sociality. Here, we investigate these questions using the clown anemonefish Amphiprion percula. Clownfish live in groups composed of a breeding pair and zero to four non-breeders that queue for breeding positions. Within groups, there is potential conflict over rank yet actual conflict is very rare. We staged contests in aquaria between pairs of non-breeding individuals over access to a key resource (an anemone), analogous to contests that would occur at the onset of group formation in the wild. The initial size ratio between individuals tended to predict the intensity, and predicted the outcome and resolution of conflict: conflict intensity was greater when individuals were more similar in size; the probability of the smaller individual winning was greater when individuals were more similar in size; and the loser of the contest grew less than the winner when individuals were more similar in size. These results provide a critical test of foundational assumptions upon which our understanding of clownfish and other fish societies has been built. More generally, the results show that one of the simplest and most effective ways for animals to resolve conflict is to modify the phenotype that triggers conflict. Significance statement: The study provides a critical test of the foundational assumptions on which our understanding of conflict and its resolution in animal societies has been built. Importantly, this study highlights that four elements of conflict must be investigated for a complete understanding of societal maintenance, and broadens the taxonomic basis of empirical research of conflict (focused on terrestrial organisms) by examining these four elements in a fish society. Specifically, the study demonstrates the key importance of relative body size (competitive ability) in determining conflict intensity, contest outcome, and subsequent conflict resolution via the regulation of subordinate growth rates. The occurrence of strategic subordinate growth regulation is intriguing because it shows that the simplest and most effective way for animals to resolve conflict is to modify the phenotypes that trigger conflict in the first place. [ABSTRACT FROM AUTHOR]