Though inconspicuous in healthy nests, Pseudoxylaria species are almost always present and overgrow deteriorating fungus-growing termite gardens. Whether these fungi are detrimental to the fungus-garden, benign, or even beneficial is unclear. We hypothesize that Pseudoxylaria is a stowaway that practices a sit-and-wait strategy to survive in the termite nest. Using isolates from three different termite genera to test our hypothesis, we compared Pseudoxylaria’s growth on 40 carbon sources with that of Termitomyces and tested its interaction with Termitomyces. The C-source use of both fungi largely overlapped, indicating potential for competition. One-to-one interactions between Pseudoxylaria, Termitomyces and free-living relatives showed that Pseudoxylaria and Termitomyces strains interacted differently with each other than with each other’s free-living relatives. Both fungi grew less together than when growing alone, confirming that they compete. Pseudoxylaria was more strongly inhibited by Termitomyces than free-living Xylariaceae were. The results suggest that the symbiotic lifestyle adopted by Pseudoxylaria goes together with reduced antagonism towards Termitomyces, consistent with Pseudoxylaria being a stowaway.