Theory predicts that environmental heterogeneity offers a potential solution to the maintenance of genetic variation within populations, but empirical evidence remains sparse. The livebearing fish Xiphophorus variatus exhibits polymorphism at a single locus, with different alleles resulting in up to five distinct melanistic “tailspot” patterns within populations. We investigated the effects of heterogeneity in two ubiquitous environmental variables (temperature and food availability) on two fitness-related traits (upper thermal limits and body condition) in two different tailspot types (wildtype and upper cut crescent). We found gene-by-environment (GxE) interactions between tailspot type and food level affecting upper thermal limits (UTL), as well as between tailspot type and thermal environment affecting body condition. Exploring mechanistic bases underlying these GxE patterns, we found no differences between tailspot types in hsp70 gene expression despite significant overall increases in expression under both thermal and food stress. Similarly, there was no difference in routine metabolic rates between the tailspot types. The reversal of relative performance of the two tailspot types under different environmental conditions revealed a mechanism by which environmental heterogeneity can balance polymorphism within populations through selection on different fitness-related traits.