Intercropping and rotating banana (Musa spp.) with Chinese chive (Allium tuberosum Rottler) has been used as an effective method to control Panama disease (Fusarium wilt) of banana in South China. However, the underlying mechanism is unknown. In this study, we used aqueous leachates and volatiles from Chinese chive to evaluate their antimicrobial activity on Fusarium oxysporum f. sp. cubense race 4 (FOC), the causal agent of Panama disease in banana, and identified the antifungal compounds. Both leaf and root leachates of Chinese chive displayed strong inhibition against FOC, but the concentrated leachates showed lower inhibition than the original leachates. In a sealed system volatiles emitted from the leaves and roots of Chinese chive inhibited mycelial growth of FOC. Volatile compounds emitted from the intact growing roots mimicking natural environment inhibited spore germination of FOC. We identified five volatiles including 2-methyl-2-pentenal and four organosulfur compounds (dimethyl trisulfide, dimethyl disulfide, dipropyl disulfide, and dipropyl trisulfide) from the leaves and roots of Chinese chive. All these compounds exhibited inhibitory effects on FOC, but 2-methyl-2-pentenal and dimethyl trisulfide showed stronger inhibition than the other three compounds. 2-Methyl-2-pentenal at 50-100 μl/l completely inhibited the mycelial growth of FOC. Our results demonstrate that antifungal volatiles released from Chinese chive help control Panama disease in banana. We conclude that intercropping and rotating banana with Chinese chive can control Panama disease and increase cropland biodiversity.