Understanding dispersal mechanisms—the movement of propagules—can shed light on how organisms are adapted for their ecosystem. Guyanagaster necrorhizus is a sequestrate fungus, meaning its dispersal propagules, or spores, are entirely enclosed within a fruiting body, termed a sporocarp. This fungus is most closely related to Armillaria and its allies. While Armillaria species form mushrooms with forcibly discharged spores, G. necrorhizus spores have lost this ability, and by necessity, must be passively dispersed. However, G. necrorhizus does not possess characteristics of other sequestrate fungi with known dispersal mechanisms. Repeated observations of termites feeding on G. necrorhizus sporocarps, and spores adhering to their exoskeleton, led to the hypothesis that termites disperse G. necrorhizus spores. To test this hypothesis, we used microsatellite markers and implemented population genetics analyses to understand patterns of clonality and population structure of G. necrorhizus. While Armillaria individuals can spread vegetatively over large areas, high genotypic diversity in G. necrorhizus populations suggest spores are the primary mode of dispersal, consistent with termite dispersal. Spatial genetic structure analyses suggest that G. necrorhizus sporocarps within 238 m of each other are more closely related than would be expected by chance. Conservative estimates from population assignment tests suggest populations separated by two km no longer exchange genes. Patterns of spatial genetic structure and population structure are consistent with previous studies analyzing foraging distances of termites found associated with G. necrorhizus sporocarps. Termites have rarely been recorded to specifically target fungal sporocarps, making this a potentially novel fungal-insect interaction.