Soil fungi are diverse and common in crop systems with important ecological function such as saprotrophs, symbionts, and pathogens, all of which are key components for soil fertility and health. Agricultural practices including tillage, crop rotation, fertilization and pest management with pesticides and microbial biocontrol agents are known to affect the abundance and composition of soil fungi, but these factors are seldom integrated and studied in combination. The objective of this study was to examine the influence of mineral and organic (compost) fertilization, and soil inoculation with the biocontrol fungus Trichoderma harzianum individually and in combination on the resident soil fungal communities and plant performance in a greenhouse pot experiment with chili pepper grown in a disease-infested agricultural soil. Soil fungal communities were studied using Illumina MiSeq sequencing and taxonomic assignment using the UNITE database in terms of amplicon sequence variants (ASV). Main results showed that the combination of compost and T. harzianum inoculation completely controlled chili pepper wilt, which coincided with alterations in soil fungal diversity. The root pathogen Fusarium equiseti was the most abundant fungus (in relative terms) in all treatments and the ASV Trichoderma sp. was only found in the treatments in which T. harzianum had been applied. Soil application with T. harzianum at sowing also reduced chili pepper damping-off in non-sterile disease-infested soil, which coincided with a reduction of the relative abundance of F. equiseti. However, several other known Fusarium spp. pathogens were present in the natural disease infested agricultural soil and could also have been involved in the chili pepper wilt observed. In conclusion, our results show promising biocontrol traits of T. harzianum against chili pepper damping off and wilt most likely caused by Fusarium spp. The observed alterations in soil fungal diversity with T. harzianum and compost were probably involved in the reduction of chili pepper wilt but needs to be further studied.