The European Union has expanded its role in preventing conflicts and building peace, but its institutional practices remain insufficiently conceptualized. This article argues that, drawing from a strong self‐perception toward a neo‐functionalist interpretation of its own history, the EU uses 'neo‐functional peace’ as an approach for resolving protracted disputes, through deconstructing highly political issues into technical meanings in order to achieve mutually acceptable agreements. This article explores the EU's efforts to normalize relations between Kosovo and Serbia, and examines the reliance on aspects of neo‐functionalism for building peace after protracted disputes. We argue that neo‐functional peace has played a crucial role in normalizing political relations and reconciling some of the outstanding disputes between Kosovo and Serbia. Building on this case study, we suggest a theoretical concept of neo‐functional peace as a useful means to conceptualize the EU's peace support practices.