Parasites can promote diversity by mediating coexistence between a poorer and superior competitor, if the superior competitor is more susceptible to parasitism. However, hosts and parasites frequently undergo antagonistic coevolution. This process may result in the accumulation of pleiotropic fitness costs associated with host resistance, and could breakdown coexistence. We experimentally investigated parasite-mediated coexistence of two genotypes of the bacterium Pseudomonas fluorescens, where one genotype underwent coevolution with a parasite (a virulent bacteriophage), whereas the other genotype was resistant to the evolving phages at all time points, but a poorer competitor. In the absence of phages, the resistant genotype was rapidly driven extinct in all populations. In the presence of the phages, the resistant genotype persisted in four of six populations and eventually reached higher frequencies than the sensitive genotype. The coevolving genotype showed a reduction in the growth rate, consistent with a cost of resistance, which may be responsible for a decline in its relative fitness. These results demonstrate that the stability of parasite-mediated coexistence of resistant and susceptible species or genotypes is likely to be affected if parasites and susceptible hosts coevolve.