Relationships between adult females are fundamental to understanding diversity in animal social systems. While cooperative relationships between kin are known to promote fitness benefits, the proximate mechanisms underlying this are not well understood. Here we show that when related female house mice (Mus musculus domesticus) cooperate to rear young communally, those with higher endogenous oxytocin levels have more egalitarian and successful cooperative relationships. Sisters with higher oxytocin concentrations in the paraventricular nucleus (PVN) of the hypothalamus weaned significantly more offspring, had lower reproductive skew and spent more equal proportions of time in the nest. By contrast, PVN oxytocin was unrelated to the number of weaned offspring produced in the absence of cooperation, and did not vary in response to manipulation of nest site availability or social cues of outgroup competition. By linking fitness consequences of cooperation with oxytocin, our findings have broad implications for understanding the evolution of egalitarian social relationships.