Several hundred species of haplochromine cichlid fish have evolved rapidly in Lake Victoria. Divergent sexual and ecological selection probably played an important role in this radiation, generating divergent mating preferences and preference-trait covariance. However, the segregation of hybrid inviability or infertility genes could also potentially generate preference-trait covariance, and the mechanisms that cause the evolution of divergent mating preferences have not been investigated in detail in any cichlid species pair. We investigated intrinsic fitness of hybrids between two sister species in the genus Pundamilia, one of the most species-rich genera of Lake Victoria cichlids. Fitness-related traits were measured in nonhybrid offspring of both species, and in the first and second hybrid generations. There were no differences in fecundity, fertility, sex ratio or growth rates either between the sister species or between these and their hybrids. By contrast, there was a difference in offspring survival between the two sister species. Offspring survival was dependent only on the species of the mother, regardless of whether the cross was conspecific or heterospecific. Further, eggs tended to be larger in the hybrids than in one of the parental species. Hence, hybrids suffered no intrinsic fitness reduction relative to nonhybrids. Our data suggest that intrinsic hybrid incompatibilities are unlikely to have caused speciation in Pundamilia, nor to maintain species boundaries in this system.