Interspecific competition driving divergence in adaptive radiation has not previously been tested experimentally. Natural selection on a morphologically variable species of stickle-back fish was contrasted in the presence and absence of a close relative. Selection was nondirectional when the target species was alone, whereas addition of the second species favored individuals most different from it morphologically and ecologically. Disproportionately severe competition between similar phenotypes indicates frequency-dependent selection, verifying a crucial element of theory of competition and character divergence. The findings help resolve outstanding debates on the ecological causes of diversification and the evolutionary consequences of competitive interactions.