Combine all ingredients in a wide pot with a tight-fitting lid and stir to combine. Place lidded pot on the stove over medium-high heat and cook for approximately 10 minutes, until the peaches and onions have softened.
Using a potato masher, break down the peach pieces. Continue to cook, with the lid off, until the mixture has reduced by approximately half.
Remove pot from heat. Using an immersion blender, puree the mixture until smooth (you may have to tip the pan a little in order to do this without splashing). If you don’t have an immersion blender, scrape the mixture into a blender or food processor and blend until smooth.
If the sauce is nice and thick, it is done. If it’s still a little watery, return it to the heat and cook a bit longer. At this point, taste it and add more salt or pepper, if necessary.
When it’s finished, divide the sauce between two half pint jars. Wipe rims, apply lids and rings and process in a boiling water bath canner for 20 minutes.
When time is up, remove jars from canner and let them cool on a folded kitchen towel.
Sealed jars can be stored in your pantry for up to one year. Unsealed jars should be refrigerated and used promptly.
Notes
If you struggle to peel the peaches, either blanch the halves in a pot of boiling water for 60-90 seconds or get a serrated peeler. Either method makes quick work of the peach skins.