Previous studies have shown that the arbuscular mycorrhizal fungus (AMF) Glomus deserticola (Trappe, Bloss and Menge) can diminish the negative effect of Verticillium dahliae Kleb. on pepper yield. On the other hand, it is known that AMF can be more beneficial for plant growth and physiology under dry conditions than when soil moisture is plentiful. Therefore, our objective was to assess if a moderate water deficit imposed on pepper plants before their inoculation with V. dahliae could improve the effectiveness of G. deserticola as biocontrol agent. In the present experiment, the delay in disease development in Verticillium-inoculated plants associated with AMF did not occur under well watered conditions. In addition, the establishment of mycorrhizal symbiosis and the development of structures by AMF were delayed when both symbiotic and pathogenic fungi infected the same root. Therefore, it is suggested that the equilibrium between pepper plant, G. deserticola and V. dahliae is so complex that small changes in competition between symbiotic and pathogenic fungi for host resources can modify the efficiency of AMF as a biocontrol agent. On the other hand, water deficit enhanced the deleterious effect of V. dahliae on fruit set and yield only when pepper plants were not associated with G. deserticola, which reinforces the idea that AMF may be more important for host plants subjected to stressful conditions. However, comparing well watered non-mycorrhizal and predroughted mycorrhizal plants, we found that moderate water deficit imposed before inoculation with V. dahliae did not improve the effectiveness of G. deserticola as a biocontrol agent.