Whoever wears the medal cannot die or be injured.
The Medal of Everlasting Life is an enchanted magical medal that saves and protects the wearer from injury, harm and death. It is an important object in the movie seeing as the town of San Ángel was attacked by the bandit king Chakal and his army of banditos looking for it.
The medal is black in the shape of a heart. It has grey spikes around it and green fabric. It also has a white skull with red eye and nose sockets in the middle, in between two green wings.
The Medal of Everlasting Life gives the wearer immortality and invulnerability from physical injury and harm, so long as the person keeps touching or wearing the medal. The wearer can also not feel pain or exhaustion/fatigue. The medal can also reawaken a mortal being from a coma, as shown when it awoke María.
At one point in time Xibalba chose Captain Mondragon as his champion in a bet against El Chamuco, giving the captain the medal along with his sword to ensure his triumph. But Chakal put his hands on the medal after killing Captain Mondragon and therefore making himself invulnerable and invincible, until Xibalba retrieved the medal back.
At the beginning of the story, when La Muerte and Xibalba make their famous bet on the Day of the Dead, both choose two children as their champions: Manolo and Joaquin. Xibalba approached Joaquín in the form of an old man, and handed him the medal in exchange for some bread, warning to the boy to keep it hidden because "a bandit king would stop at nothing to get it back".
Fearing that the "bandit king" was Chakal, the same one who had killed his father, Captain Mondragón, Joaquín kept the medal secret for ten years. Although the medal helped Joaquin to become the hero of San Ángel, at the same time, the fact of having to keep it hidden made him a little paranoid.
Finally, Chakal discovered that the medal was in San Angel and went there with his army of bandits to retrieve it, annihilating anyone who got in his way. During the battle, Joaquin handed secretly the medal to Manolo to make sure he would survived; at the cost of losing an eye. When Chakal was defeated, Joaquín returned the medal to Xibalba.