1. Aggregation pheromones can evolve when individuals benefit from clustering. Such a situation can arise with an Allee effect, i.e. a positive relationship between individual fitness and density of conspecifics. Aggregation pheromone in Drosophila induces aggregated oviposition. The aim of the work reported here was to identify an Allee effect in the larval resource exploitation by Drosophila melanogaster, which could explain the evolution of aggregation pheromone in this species. 2. It is hypothesised that an Allee effect in D.melanogaster larvae arises from an increased efficiency of a group of larvae to temper fungal growth on their feeding substrate. To test this hypothesis, standard apple substrates were infested with specified numbers of larvae, and their survival and development were monitored. A potential beneficial effect of the presence of adult flies was also investigated by incubating a varying number of adults on the substrate before introducing the larvae. A 3. Fungal growth was related negatively to larval survival and the size of the emerging flies. Although the fungal growth on the substrate was largely reduced at increased larval densities, the measurements of fitness components indicated no Allee effect between larval densities and larval fitness, but rather indicated larval competition. 4. In contrast, increased adult densities on the substrates prior to larval development yielded higher survival of the larvae, larger emerging flies, and also reduced fungal growth on the substrates. Hence, adults enhanced the quality of the larval substrate and significant benefits of aggregated oviposition in fruit flies were shown. Experiments with synthetic pheromone indicated that the aggregation pheromone itself did not contribute directly to the quality of the larval resource.