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We established experimental populations of winter bent grassAgrostis hyemalisacross a range of prevalence of the heritable fungal endophyteEpichloë amarillans. Using irrigation, we elevated the precipitation for half of the populations, which we hypothesized would weaken the benefits of symbiosis. Across two annual transitions, we assayed 5,485 individuals to determine prevalence and censused 954 individuals for demographic (survival, flowering, reproduction and recruitment) and vertical transmission data. We used hierarchical Bayesian models to infer long‐run equilibria from short‐term changes in symbiont prevalence and estimated demographic vital rates to link individual‐level effects to population‐level outcomes.

We found evidence for all three proposed mechanisms for intermediate symbiont prevalence, but the outcome differed qualitatively across years and precipitation treatments. In the first year, symbionts trended towards fixation under drought conditions but drifted neutrally under elevated precipitation. Fixation likely arose from symbiont‐conferred recruitment benefits outweighing reproductive costs under the drought conditions, while elevated precipitation tempered these effects. In the second transition year, we inferred stable intermediate prevalence across both precipitation treatments, which indicated a balance between symbiont conferred recruitment benefits that allowed low‐prevalence populations to increase and imperfect transmission that caused high‐prevalence populations to decrease.

Synthesis. We find support for neutral, transient and stable mechanisms underlying symbiont prevalence, indicating that symbiont prevalence is often pushed and pulled in different directions by the composite outcome of symbiont effects on demographic rates and transmission efficiency, and the way in which these processes respond to environmental context.