To stop fighting or arguing; to reach an agreement, or at least a truce.

Examples

"They need to calm down and bury the hatchet before someone gets hurt."

Etymology

The phrase is an allusion to the figurative or literal practice of putting away the tomahawk at the cessation of hostilities among or by Native Americans in the Eastern United States, specifically during the formation of the Iroquois Confederacy, and in Iroquois custom in general. Weapons were to be buried or otherwise cached in time of peace.

Sources

Wiktionary