Alignment refers to the value representing how good, evil or in between a player is. Positive alignment indicates a righteous player, raised by performing everyday prayers. The amount of Alignment that a player can gain per day has a cap(limit) on it. Negative alignment indicates a villainous player, and alignment decreases by murdering, assaulting, robbing or knocking out other players.
Alignment raises slowly but drops quickly, and you can not gain alignment from killing low alignment players. This creates a system of greater risk for greater reward: killing players will allow the attacker to loot the victims corpse, but if the attacker is killed their skill points receive much greater penalties because of low alignment.
Therefore, players have the ability to shout I yield! - making them more vulnerable to damage BUT if the opponent kills the victim in this state, they take a much larger alignment hit. If the attacker spares the victim, however, they are able to incapacitate the victim in one hit and loot them. The attacker gets the victims items and a minor alignment reduction; the victim walks home naked with his skill points intact.