Bacterial fitness and adaptability in microbial communities are influenced by interspecies interactions and spatial organization. This study investigated how these factors shape the evolutionary dynamics of Bacillus thuringiensis. A distinct phenotypic variant of B. thuringiensis emerged consistently under both planktonic and biofilm conditions, as well as in monospecies and mixed-species settings, but was strongly selected in biofilms and during coexistence with Pseudomonas defluvii and/ or Pseudomonas brenneri. Compared to its ancestor, the variant exhibited shorter generation times, reduced sporulation, auto-aggregation, and lower biomass in mixed-species biofilms. Mutations in the spo0A regulator, which controls sporulation and biofilm matrix production, were identified in all variants. Proteomics revealed a reduction in TasA, a key matrix protein, in the variant but increased levels in co-culture with P. brenneri. These findings highlight how interspecies interactions drive B. thuringiensis diversification, promoting traits like reduced matrix production and species coexistence, with implications for microbial consortia applications in agriculture and biopesticides.