Microorganism-produced volatile organic compounds (VOCs) are considered promising environmental-safety fumigants in food preservation. In this study, the VOCs from fungal Ceratocystis fimbriata strains (WSJK-1, Mby) were tested against postharvest fungi Monilinia laxa, Fusarium oxysporum, Monilinia fructicola, Botrytis cinerea, Alternaria solani, and Aspergillus flavus in vitro. The mycelial growth was significantly inhibited, in particular M. fructicola and B. cinerea (76.95, 76.00%), respectively. VOCs were identified by headspace solid-phase microextraction coupled with Gas Chromatography–Mass Spectrometry (HS-SPME-GC–MS); 40 compounds were identified. The antifungal activity of 21 compounds was tested by the minimum inhibitory concentrations (MIC) value. Benzaldehyde, 2-Phenylethanol, and 1-Octen-3-ol showed strong antifungal activity with the MIC in vitro ranging from 0.094 to 0.284 ml L−1 depending on the pathogen tested. The optical microscope showed serious morphological damage, including cell deformation, curling, collapse, and deficiency in mycelial or conidia cell structures treated with C. fimbriata VOCs and pure compounds. In vivo tests, C. fimbriata VOCs decreased brown rot severity in peaches, and compounds Benzaldehyde and 2-Phenylethanol could reduce peach brown rot in peaches at 60 μl L−1. The VOCs produced by C. fimbriata strain have good antifungal effects; low concentration fumigation could control peach brown rot. Its fragrance is fresh, safe, and harmless, and it is possible to replace chemical fumigants. It could be used as a potential biofumigant to control fruit postharvest transportation, storage, and food preservation. To the best of our knowledge, this is the first report on the antifungal activity and biocontrol mechanism of VOCs produced by C. fimbriata.