Microbial populations form intricate macroscopic colonies with diverse morphologies whose functions remain to be fully understood. Despite fungal colonies isolated from environmental and clinical samples revealing abundant intraspecies morphological diversity, it is unclear how this diversity affects fungal fitness and disease progression. Here we observe a notable effect of oxygen tension on the macroscopic and biofilm morphotypes of the human fungal pathogen Aspergillus fumigatus. A hypoxia-typic morphotype is generated through the expression of a subtelomeric gene cluster containing genes that alter the hyphal surface and perturb interhyphal interactions to disrupt in vivo biofilm and infection site morphologies. Consequently, this morphotype leads to increased host inflammation, rapid disease progression and mortality in a murine model of invasive aspergillosis. Taken together, these data suggest that filamentous fungal biofilm morphology affects fungal-host interactions and should be taken into consideration when assessing virulence and host disease progression of an isolated strain.