Local adaptation (LA) is expected to arise when populations evolve higher fitness in their local environment than migrants, particularly in heterogeneous environments and coevolving host–parasite systems. Such adaptation can influence species interactions, including competition and parasitism, and is often predicted to help populations cope with environmental change. However, how LA to environmental conditions affects competition between resident and migrant individuals of the same species—and how parasitism modifies these interactions—remains poorly understood. Here, I conducted a reciprocal transplant experiment across 12 artificial pond populations in a naturally coevolving Daphnia–microparasite mesocosm system. Hosts from each population were placed in field cages in their home or away environments and either alone or mixed with individuals from another population. Treatments were exposed to an ancestral parasite or maintained parasite-free. Host fitness was measured as reproductive output. Contrary to theoretical expectations, residents showed no evidence of LA across populations. However, mixing residents with migrants reduced host fitness relative to unmixed treatments during the third week of the experiment, and this effect was significant only under parasite exposure. This pattern suggests that competition between genotypes became detectable when infection acted as a general stressor. Overall, our results show no detectable LA despite environmental heterogeneity in naturally coevolving host–parasite populations. The ability of non-locally adapted residents to compete with migrant genotypes under parasite exposure may facilitate gene flow among populations and potentially reduce future disease risk by increasing host genetic diversity and lowering transmission.