The free‐living soil nematode Caenorhabditis elegans interacts with diverse microorganisms in its natural habitat. These microorganisms may serve as a food source or represent a harmful threat. As such, they constitute one of the most important ecological factors of the worm’s natural environment. In this study, we examined the interaction between two natural isolates of C. elegans and three natural isolates of the entomopathogenic bacterium Photorhabdus luminescens. Two of the tested P. luminescens strains were clearly pathogenic. They consistently reduced the worm’s developmental, survival and reproductive rate, most likely through the production of nematicidal compounds. The third natural isolate tested did not decrease worm fitness. These differences could be associated with a deletion of one gene (tcdA4) (∼7kb) of the toxin complex D pathogenicity island, which was found in only the non‐pathogenic strain. Our study additionally highlights the importance of behaviour in defence. Caenorhabditis elegans showed two distinct avoidance behaviours towards the pathogenic but not the non‐pathogenic P. luminescens strains. In particular, nematodes physically escaped and also reduced the ingestion of pathogenic bacteria. Our results strongly suggest that C. elegans possesses the capacity to distinguish between and subsequently respond to harmful and non‐harmful strains of the same bacterial species. The underlying mechanisms of such interactions are currently unknown. Their dissection will represent a major challenge for future research and should enhance our knowledge of the ecology of this important model organism in biological research.