Aflatoxin B1 (AFLB1) is a carcinogen produced by Aspergillus flavus, with AFLB1 contamination in harvested or stored crops well documented. However, information on its occurrence in soil and crop debris is scarce. A series of experiments investigated the occurrence of AFLB1 in soil and corn residues, and to ascertain the ecology of A. flavus in a Dundee silt loam soil. Samples of untilled soil (0 to 2 cm) and corn residues were collected in March 2007 from plots previously planted with a Bt or non-Bt isolines. AFLB1 levels determined by HPLC were significantly different in leaves/stalks, cobs and grain remaining on cobs. The highest AFLB1 levels were observed in cobs containing grain, with 145 and 275 ng g-1, in Bt and non-Bt residues, respectively (Pr > F = 0.001). Aflatoxin levels averaged 3.3 and 9.6 ng g-1 in leaves/stalks and cobs, respectively and all soils had detectable AFLB1 ranging from 1.3 to 7.3 ng g-1 soil with similar levels in plots from Bt and non-Bt corn. Based on cultural methods, soil contained from log (10) 3.1 to 4.5 propagules of A. flavus g-1 soil with about 60% of A. flavus being afla-toxigenic. Laboratory studies investigated the dissipation of AFLB1 in this soil. Results indicate that AFLB1 is rapidly degraded at 28 C (half-life < 5 days). The potential of the soil A. flavus to produce aflatoxins was confirmed by molecular methods. Transcription of two regulatory genes aflR and aflS, and a number of aflatoxin biosynthesis genes including aflD, aflP, and aflQ, were detected by RT-PCR analysis in soil. While AFLB1 has a short persistence in soil, the density of A. flavus in soil and the detection of AFLB1 and AFLB1 biosynthesis transcripts supports the conclusion that AFLB1 is produced in surface soil especially associated with corn residues.