Punishment of free-riding has been implicated in the evolution of cooperation in humans, and yet mechanisms for punishment avoidance remain largely uninvestigated. Individual variation in these mechanisms may stem from variation in the serotonergic system, which modulates processing of aversive stimuli. Functional serotonin gene variants have been associated with variation in the processing of aversive stimuli and widely studied as risk factors for psychiatric disorders. We show that variants at the serotonin transporter gene (SLC6A4) and serotonin 2A receptor gene (HTR2A) predict contributions to the public good in economic games, dependent upon whether contribution behavior can be punished. Participants with a variant at the serotonin transporter gene contribute more, leading to group-level differences in cooperation, but this effect dissipates in the presence of punishment. When contribution behavior can be punished, those with a variant at the serotonin 2A receptor gene contribute more than those without it. This variant also predicts a more stressful experience of the games. The diversity of institutions (including norms) that govern cooperation and punishment may create selective pressures for punishment avoidance that change rapidly across time and space. Variant-specific epigenetic regulation of these genes, as well as population-level variation in the frequencies of these variants, may facilitate adaptation to local norms of cooperation and punishment.