Aflatoxin B1 (AFB1) is a fungal toxin that has been implicated as a causative agent in human hepatic and extrahepatic carcinogenesis. In this review, the mechanisms involved in AFB1 toxicity are delineated, in order to describe the features that make a specific cell, tissue, or species susceptible to the mycotoxin. Important considerations include: (i) different mechanisms for bioactivation of AFB1 to its ultimate carcinogenic epoxide metabolite; (ii) the balance between bioactivation to and detoxification of the epoxide; (iii) the interaction of AFB1 epoxide with DNA and the mutational events leading to neoplastic transformation; (iv) the role of cytotoxicity in AFB1 carcinogenesis; (v) the significance of nonepoxide metabolites in toxicity; and (vi) the contribution of mycotoxin-unrelated disease processes. Although considerable controversy remains about the importance of specific events, a great deal has been learned about biochemical and molecular actions of AFB1.