An overwhelming majority of humans are right-handed. Numerous explanations for individual handedness have been proposed, but this population-level handedness remains puzzling. Here, we present a novel mathematical model and use it to test the idea that population-level hand preference represents a balance between selective costs and benefits arising from cooperation and competition in human evolutionary history. We use the selection of elite athletes as a test-bed for our evolutionary model and find evidence for the validity of this idea. Our model gives the first quantitative explanation for the distribution of handedness both across and within many professional sports. It also predicts strong lateralization of hand use in social species with limited combative interaction, and elucidates the absence of consistent population-level 'pawedness' in some animal species.