The impact of the plague minnow Gambusia holbrooki on the ornate rainbowfish Rhadinocentrus ornatus was investigated by comparing the behavioural response and microhabitat preferences of populations of R. ornatus collected from locations that are sympatric and allopatric with G. holbrooki. Rhadinocentrus ornatus populations from sympatric areas exhibited a significantly higher frequency of intraspecific chases, spent significantly more time at an intermediate depth and were nipped significantly less often by G. holbrooki compared to the allopatric R. ornatus populations. The frequency of intraspecific chases by all R. ornatus populations were greatest immediately following G. holbrooki exposure and increased further with repeated exposure. Activity levels were also significantly higher in the presence of G. holbrooki. Gambusia holbrooki and the allopatric R. ornatus populations showed very similar microhabitat preferences, whereas the preferences for the sympatric R. ornatus populations have shifted to facilitate cohabitation with G. holbrooki. The results suggest that sympatric populations of R. ornatus have evolved or developed behavioural responses to G. holbrooki through niche and character shifts. The implications are discussed in relation to the conservation management of R. ornatus and other threatened species.