Although interspecific competition has long been recognized as a major driver of trait divergence and adaptive evolution, relatively little effort has focused on how it influences the evolution of intraspecific cooperation. Here we identify the mechanism by which the perceived pressure of interspecific competition influences the transition from intraspecific conflict to cooperation in a facultative cooperatively breeding species, the Asian burying beetle Nicrophorus nepalensis. We not only found that beetles are more cooperative at carcasses when blowfly maggots have begun to digest the tissue, but that this social cooperation appears to be triggered by a single chemical cue—dimethyl disulfide (DMDS)—emitted from carcasses consumed by blowflies, but not from control carcasses lacking blowflies. Our results provide experimental evidence that interspecific competition promotes the transition from intraspecific conflict to cooperation in N. nepalensisvia a surprisingly simple social chemical cue that is a reliable indicator of resource competition between species.