Microbes colonizing a surface often experience colony growth dynamics characterized by an initial phase of spatial clonal expansion followed by collision between neighboring colonies to form potentially genetically heterogeneous boundaries. For species with life cycles consisting of repeated surface colonization and dispersal, these spatially-explicit “expansion-collision dynamics” generate periodic transitions between two distinct selective regimes, “expansion competition” and “boundary competition”, each one favoring a different growth strategy. We hypothesized that this dynamic could promote stable coexistence of expansion- and boundary-competition specialists by generating time-varying, negative frequency-dependent selection that insulates both types from extinction. We tested this experimentally in budding yeast by competing an exo-enzyme secreting “cooperator” strain (expansion-competition specialists) against non-secreting “defectors” (boundary-competition specialists). As predicted, we observed cooperator-defector coexistence or cooperator dominance with expansion-collision dynamics, but only defector dominance otherwise. Also as predicted, the steady-state frequency of cooperators was determined by colonization density (the average initial cell-cell distance) and cost of cooperation. Lattice-based spatial simulations give good qualitative agreement with experiments, supporting our hypothesis that expansion-collision dynamics with costly public goods production is sufficient to generate stable cooperator-defector coexistence. This mechanism may be important for maintaining public-goods cooperation-and-conflict in microbial pioneer species living on surfaces.