Rapid progress has recently been made regarding how the niche controls stem cell function, but little is yet known about how stem cells in the same niche interact with one another. In this study, we show that differentiation-defective Drosophila ovarian germline stem cells (GSCs) can outcompete normal ones for niche occupancy in a cadherin-dependent manner. The differentiation-defective bam or bgcn mutant GSCs invade the niche space of neighboring wild-type GSCs and gradually push them out of the niche by upregulating E-cadherin expression. Furthermore, the bam/bgcn-mediated GSC competition requires E-cadherin and normal GSC division, but not the self-renewal-promoting BMP niche signal, while different E-cadherin levels can sufficiently stimulate GSC competition. Therefore, we propose that GSCs have a competitive relationship for niche occupancy, which may serve as a quality control mechanism to ensure that accidentally differentiated stem cells are rapidly removed from the niche and replaced by functional ones.