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Standard epidemiological theory predicts that parasites, which continuously release propagules during infection, face a trade-off between virulence and transmission. However, little is known how host resistance and parasite virulence change during coevolution with obligate killers. To address this question we have set up a coevolution experiment evolving Nosema whitei on eight distinct lines of Tribolium castaneum. After 11 generations we conducted a time-shift experiment infecting both the coevolved and the replicate control host lines with the original parasite source, and coevolved parasites from generation 8 and 11. We found higher survival in the coevolved host lines than in the matching control lines. In the parasite populations, virulence measured as host mortality decreased during coevolution, while sporeload stayed constant. Both patterns are compatible with adaptive evolution by selection for resistance in the host and by trade-offs between virulence and transmission potential in the parasite.