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Cooperative communication has been recently proposed as a way to mitigate fading in wireless networks. Analytical results indicate that network performance improvement by cooperative communication heavily depends on selecting suitable relay nodes. Previous work on relay selection fails to consider the impact of inter-node interference among transmissions, which potentially results in a degradation of network performance. In this study, it is shown how the use of relay nodes may degrade rather than improve network performance (e.g. throughput) in scenarios where inter-node interference is not accounted for. In this approach, inter-node interference is embedded into our relay selection strategy through a newly proposed distributed interference-aware relay selection (DIRS) algorithm for IEEE 802.11-based wireless networks with multiple source-destination pairs. Under DIRS algorithm, each source-destination pair will select an optimal relay based on both the channel quality and the interference information, which can be obtained locally without the knowledge of topology information. The simulation results demonstrate the effectiveness of our proposal and show that inter-node interference can be mitigated by optimising relay selection.