Memory conformity occurs when an individual endorses what other individuals remember about past events. Research on memory conformity is currently dominated by a ‘forensic’ perspective, which views the phenomenon as inherently undesirable. This is because conformity not only distorts the accuracy of an individual’s memory, but also produces false corroboration between individuals, effects that act to undermine criminal justice systems. There is growing awareness, however, that memory conformity may be interpreted more generally as an adaptive social behavior regulated by explicit mentalizing mechanisms. Here, we provide novel evidence in support of this emerging alternative theoretical perspective. We carried out a memory conformity experiment which revealed that explicit belief-simulation (i.e. using one’s own beliefs to model what other people believe) systematically biases conformity towards like-minded individuals, even when there is no objective evidence that they have a more accurate memory than dissimilar individuals. We suggest that this bias is functional, i.e. adaptive, to the extent that it fosters trust, and hence cooperation, between in-group versus out-group individuals. We conclude that memory conformity is, in more fundamental terms, a highly desirable product of explicit mentalizing mechanisms that promote adaptive forms of social learning and cooperation.