It was reported soon after the film's production that the two actors, who play brothers in the 1930s-set Western, had got into a physical altercation on set, with Hardy claiming that LaBeouf "knocked him out cold".
Hillcoat confirmed to Digital Spy that Hardy and LaBeouf's real-life dynamic "mirrored" their fraught on-screen relationship at times, and attributed this to both actors' commitment to their roles.
"There is something that happens, I've seen it happen before," the helmer explained. "It's such an intense thing to make a film. So when you're shooting, often with serious actors who are fully enmeshed in the roles, it'll start to play out in ways. So yeah, there was a bit of that mirroring.
"There was no shootouts," Hillcoat hastened to add.
Asked what had made Hardy and LaBeouf the best choices for their roles, screenwriter Nick Cave joked: "That they were gonna beat the s**t out of each other."
Hillcoat went on to explain that he had been attracted to the chalk-and-cheese contrast between the two actors.
"Shia's so enthusiastic and chomping at the bit, and Tom has this kind of stoic power to him. So they're quite different energies."
LaBeouf recently admitted that his co-star Mia Wasikowska had been alarmed by his "aggressive" behaviour during filming.
Lawless is released in UK cinemas today (September 7).
Watch Hardy and LaBeouf on screen together in a clip below: