Let $G$ be a graph, and let $f_G$ be the sum of $(-1)^{|A|}$, over all stable sets $A$. If $G$ is a cycle with length divisible by three, then $f_G= \pm 2$. Motivated by topological considerations, G. Kalai and R. Meshulam made the conjecture that,if no induced cycle of a graph $G$ has length divisible by three, then $|f_G|\le 1$. We prove this conjecture.