Didelphis albiventris and D. aurita are Neotropical marsupials that share a unique evolutionary history and both are largely distributed throughout South America, being primarily allopatric throughout their ranges. In the Araucaria moist forest of Southern Brazil these species are sympatric and they might potentially compete having similar ecology. For this reason, they are ideal biological models to address questions about ecological character displacement and how closely related species might share their geographic space. Little is known about how two morphologically similar species of marsupials may affect each other through competition, if by competitive exclusion and competitive release. We combined ecological niche modeling and geometric morphometrics to explore the possible effects of competition on their distributional ranges and skull morphology. Ecological niche modeling was used to predict their potential distribution and this method enabled us to identify a case of biotic exclusion where the habit generalist D. albiventris is excluded by the presence of the specialist D. aurita. The morphometric analyses show that a degree of shape discrimination occurs between the species, strengthened by allometric differences, which possibly allowed them to occupy marginally different feeding niches supplemented by behavioral shift in contact areas. Overlap in skull morphology is shown between sympatric and allopatric specimens and a significant, but weak, shift in shape occurs only in D. aurita in sympatric areas. This could be a residual evidence of a higher past competition between both species, when contact zones were possibly larger than today. Therefore, the specialist D. aurita acts a biotic barrier to D. albiventris when niche diversity is not available for coexistence. On the other hand, when there is niche diversification (e.g. habitat mosaic), both species are capable to coexist with a minimal competitive effect on the morphology of D. aurita.