Without the top-down effects and the external/physical forcing, a stable coexistence of two phytoplankton species under a single resource is impossible - a result well known from the principle of competitive exclusion. Here I demonstrate by analysis of a mathematical model that such a stable coexistence in a homogeneous media without any external factor would be possible, at least theoretically, provided (i) one of the two species is toxin producing thereby has an allelopathic effect on the other, and (ii) the allelopathic effect exceeds a critical level. The threshold level of allelopathy required for the coexistence has been derived analytically in terms of the parameters associated with the resource competition and the nutrient recycling. That the extra mortality of a competitor driven by allelopathy of a toxic species gives a positive feed back to the algal growth process through the recycling is explained. And that this positive feed back plays a pivotal role in reducing competition pressures and helping species succession in the two-species model is demonstrated. Based on these specific coexistence results, I introduce and explain theoretically the allelopathic effect of a toxic species as a 'pseudo-mixotrophy'-a mechanism of 'if you cannot beat them or eat them, just kill them by chemical weapons'. The impact of this mechanism of species succession by pseudo-mixotrophy in the form of alleopathy is discussed in the context of current understanding on straight mixotrophy and resource-species relationship among phytoplankton species.