The stability of peeling modes in zero net current stellarator plasma is studied in high poloidal mode number m 1 approximation. The vacuum region solution is taken into account. Under these conditions in Mercier stable magnetic hill plasmas internal peeling modes are stable. External peeling modes can be unstable, but several limitations on them are found. It is shown that an analytically derived pressure gradient threshold is in reasonable agreement with the experimental observations and numerical calculations. The threshold decreases with increasing poloidal mode number m. It is shown, however, that higher modes may be stabilized due to finite ion Larmor radius effects. For the sake of definiteness, we have investigated peeling mode behavior in Mercier unstable plasma. It is shown that both external and internal peeling modes can be unstable in this regime. However, external and internal peeling modes in this case are definitely different.