To speak very generally, some people like to argue that sports can take the place of warfare, allowing distinctly different peoples a chance to confront one another in non-violent ways. This may be too much of a stretch for some people, but it's an interesting idea.
International sporting events like the Olympic games and the World Cup (of soccer) are two examples of sport as scaled-down-conflict but still large scale competition.
On a more person level, sports are obviously beneficial in their promotion of physical health. Sports get us moving. Fitness and sports go hand-in-glove. This point is probably too obvious to bear examples.
Potential negative aspects of sports might include the creation of unhealthy psychologies such as a belief in the idea that "winning is everything". This type of belief system could lead to low self-esteem on one end and unscrupulous/immoral behavior on the other.