The evolution of conspicuous male traits is thought to be driven by female mate choice or male–male competition. These two mechanisms are often viewed as distinct processes, with most studies focusing on female choice. However, both mechanisms of sexual selection can act simultaneously on the same trait (i.e., dual function) and/or interact in a synergistic or conflicting way. Dual-function traits are commonly assumed to originate through male–male competition before being used in female choice; yet, most studies focusing on such traits could not determine the direction of change, lacking phylogenetic information. We investigated the role of conspicuous male seasonal plumage in male–male competitive interactions in the purple-crowned fairy-wren Malurus coronatus, a cooperatively breeding bird. Male breeding plumage in most Malurus species is selected by female choice through extra-pair mate choice, but unlike its congeners, M. coronatus is genetically monogamous, and females do not seem to choose males based on breeding plumage acquisition. Our study shows that, within groups, subordinate males that were older, and therefore higher-ranked in the queue for breeder position inheritance, produced a more complete breeding plumage. In line with this, subordinate males that were older and/or displayed a more complete breeding plumage were more successful in competitively acquiring a breeder position. A role as a signal of competitive ability was experimentally confirmed by presenting models of males: in breeding colours, these received more aggression from resident breeder males than in nonbreeding colours, but elicited limited response from females, consistent with competitors in breeding plumage being perceived as a bigger threat to the breeder male. The role of the conspicuous breeding plumage in mediating male–male interactions might account for its presence in this genetically monogamous species. As phylogenetic reconstructions suggest a past female choice function in M. coronatus, this could represent a sexual trait that shifted functions, or a dual-function trait that lost one function. These evolutionary scenarios imply that intra- and intersexual functions of ornaments may be gained or lost independently and offer new perspectives in understanding the complex dynamics of sexual selection.