By "the peace of God" is meant, either the peace believers have with God, which is his gift, and passes all understanding, and flows from a comfortable apprehension of interest in the blood, righteousness, and atonement of Christ; or rather that peace which does, or should subsist among the saints themselves, which God is the author of, calls for, and requires, and encourages in them.

The Greek word translated as "rule" in Colossians 3:15 means to direct and control (Thayer's Greek Lexicon - Ref. 3). To have the peace of Christ ruling in our hearts, we must yield completely to God's direction and control of our lives -- present and future.