Variation among species in the strength of conspecific density dependence could regulate tree diversity and abundances in forest communities, but empirical tests of the factors that generate such variation are lacking. We examined seedling survival over 9 years for 28 tree species in a 24-ha subtropical forest plot in relation to neighborhood effects, and in the same forest identified soil fungi associated with plant roots via DNA sequencing. Using a multilevel mixed model approach, we found that much of the variation in the conspecific, but not heterospecific, neighbor effects was explained by species differences in the rate at which trees accumulated fungi as they grew. Species with higher rates of accumulation of pathogenic fungi suffered more from conspecific neighbors, whereas species with higher rates of ectomycorrhizal accumulation were less inhibited by conspecific neighbors. Our study demonstrates the importance of soil organisms in mediating tree neighborhood interactions and suggests that mutualistic and pathogenic fungi play important, but opposing, roles.