The accumulation of exceptional ecological diversity within a lineage is a key feature of adaptive radiation resulting from diversification associated with the subdivision of previously underutilized resources. The invasion of unoccupied niche space is predicted to be a key determinant of adaptive diversification, and this process may be particularly important if the diversity of competing lineages within the area, in which the radiation unfolds, is already high. Here, we test whether the evolution of nectarivory resulted in significantly higher rates of morphological evolution, more extensive morphological disparity, and a heightened build-up of sympatric species diversity in a large adaptive radiation of passerine birds (the honeyeaters, ca. 190 species) that have diversified extensively throughout continental and insular settings. We find that a large increase in rates of body size evolution and general expansion in morphological space followed an ancestral shift to nectarivory, enabling the build-up of large numbers of co-occurring species that vary greatly in size, compared to related and co-distributed non-nectarivorous clades. These results strongly support the idea that evolutionary shifts into novel areas of niche space play a key role in promoting adaptive radiation in the presence of likely competing lineages.