Biological N2 fixation (BNF) in the rhizosphere of Podocarpaceae is currently attributed to unspecific diazotrophs with negligible impact on N acquisition. Here, we report specific and high associative BNF in dead cells of root nodules of Lepidothamnus fonkii distributed in ombrotrophic peatlands of Patagonia. BNF of nodulated roots, intact plants of L. fonkii and rhizospheric peat was assessed by 15N2 and acetylene reduction. Diazotrophs were identified by electron microscopy, analysis of nitrogenase encoding genes (nifH) and transcripts, and 16S rRNA. Nitrogenase encoding nifH transcripts from root nodules point to Beijerinckiaceae (Rhizobiales), known as free-living diazotrophs. Electron microscopy and 16S rRNA analysis likewise identified active Beijerinckiaceae in outer dead cells of root nodules. NifH transcripts from the rhizopshere peat revealed diverse active diazotrophs including Beijerinckiaceae. Both methods revealed high activity of nitrogenase rates in cut roots of L. fonkii (2.5 μmol N g−1 d.w. d−1 based on 15N2 assay; 2.4 μmol C2H4 g−1 d.w. d−1 based on acetylene reduction assay). The data suggest that (i) nodules recruit diazotrophic Beijerinckiaceae from peat, (ii) dead nodule cells provide an exclusive habitat for Beijerinckiaceae, and (iii) BNF in L. fonkii is one potent pathway to overcome N deficiency in ombrotrophic peatlands of Patagonia.