||Humans exhibit a remarkable capacity for cooperation among genetically unrelated individuals. Yet, human cooperation is neither universal, nor stable. Instead, cooperation is often bounded to members of particular groups, and such groups endogenously form or break apart. Cooperation networks are parochial and under constant reconfiguration. Here, we demonstrate how parochial cooperation networks endogenously emerge as a consequence of simple reputation heuristics people may use when deciding to cooperate or defect. These reputation heuristics, such as “a friend of a friend is a friend” and “the enemy of a friend is an enemy” further lead to the dynamic formation and fission of cooperative groups, accompanied by a dynamic rise and fall of cooperation among agents. The ability of humans to safeguard kin-independent cooperation through gossip and reputation may be, accordingly, closely interlinked with the formation of group-bounded cooperation networks that are under constant reconfiguration, ultimately preventing global and stable cooperation.