Combine the sugar, vinegar and water in a large pot, and bring to a boil. Boil for 5 minutes. Press one or two cloves into each peach, and place into the boiling syrup. Boil for 20 minutes, or until peaches are tender.
Spoon peaches into sterile jars and top with liquid to 1/2 inch from the rim. Put one cinnamon stick into each jar. Wipe the rims with a clean dry cloth, and seal with lids and rings. Process in a hot water bath for 10 minutes to seal, or consult times recommended by your local extension.