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While the effects of electoral rules on party-system structure and the dynamics of electoral competition have been studied extensively, their effects on within-party ideological homogeneity and cohesion are virtually absent from the literature. That is, our understanding on the relationship between electoral rule disproportionality and party cohesion (and homogeneity) lacks both a complete formal argument and also causal empirical evidence to back it up. In this paper, we construct a probabilistic spatial model of electoral competition --where parties endogenously determine the ideological breadth of their lists-- in order to highlight the trade-off that policy-motivated parties face in selecting their candidates: a more heterogenous list increases the chances of electoral success and the probability of implementing its policy but, at the same time, fielding a more diverse list of candidates increases the likelihood that the implemented policy outcome moves away from its ideal point –even if the party elects more candidates, those are less likely to be “true partisans” in ideological terms. Thus, in equilibrium, as the rule becomes more disproportional (and the seat-vote ratio favours the winner disproportionally) parties have incentives to increase the ideological dispersion of their lists, thus becoming less homogenous and cohesive in ideological terms. We test this prediction using a novel data-set that records the positions of candidates that participated in Finnish municipal elections (2009-2016). We exploit the fact that council size changes exogenously at different population thresholds and using an RDD we identify the causal effect of electoral rule disproportionality (smaller council size implies more disproportional rule in favour of the winner) on parties' ideological homogeneity and cohesion. We find strong evidence in favour of the theory: proportionality increases party cohesion and homogeneity. Our work makes two major contributions. First, it highlights the importance of electoral rules as the major institutional determinant of intra-party cohesion. Second, it uncovers a new trade-off in the choice of electoral rules: while proportional rules increase party-system fragmentation (and the likelihood of coalition governments), at the same time, they also make parties more ideologically homogenous thus making compromise (in coalitions) more difficult.