Endophytic plant symbionts can have powerful effects on the way their hosts interact with pathogens, competitors, and consumers. The presence of endophytes in plants can alter food webs, community composition and ecosystem processes, suggesting that endophyte-plant symbioses may represent unique forms of extended phenotypes. We tested the impact of the fungal endophyte Alternaria alternata (phylotype CID 120) on the allelopathic effect of the invasive forb Centaurea stoebe when in competition with the North American native bunchgrass Koeleria macrantha in a greenhouse competition experiment. The allelopathic effect of C. stoebe on K. macrantha when infected with the fungal endophyte was more than twice that of endophyte-free C. stoebe. However, this allelopathic effect was a small part of the very large competitive effect of C. stoebe on K. macrantha in all treatments, likely because of the priority effects in our experimental design. To our knowledge, these results are the first experimental evidence for a symbiotic relationship between plants and fungal endophytes affecting allelopathic interactions between competing plants, and thus provide insight into the mechanisms by which fungal endophytes may increase the competitive ability of their hosts.