Conflicts of interest over resources or reproduction among individuals in a social group have long been considered to result in automatic and universal costs to group living. However, exploring how social conflict varies with group size has produced mixed empirical results. Here we develop a model that generates alternative predictions for how social conflict should vary with group size depending on the type of benefits gained from being in a social group. We show that a positive relationship between social conflict and group size is favored when groups form primarily for the benefits of sociality but not when groups form mainly for accessing group-defended resources. Thus, increased social conflict in animal societies should not be viewed as an automatic cost of larger social groups. Instead, studying the relationship between social conflict and the types of grouping benefits will be crucial for understanding the evolution of complex societies.