Hazelnuts are an economically important nut which is consumed world-wide. It is prone to infection by Aspergillus flavus and contamination with aflatoxins. Taking Tukey’s hazelnuts as a research object, the objective of this study were to (a) quantify respiration rates and (b) dry matter losses (DMLs) and (c) aflatoxin B1 (AFB1) contamination of naturally stored shelled hazelnuts at different temperatures and water availabilities. Subsequently, shelled hazelnuts were inoculated with additional A. flavus inoculum prior to storage to examine effects on dry matter losses and on AFB1 contamination. Maximum respiration of hazelnuts and associated mycoflora was under wetter conditions of 0.90~0.95 water activity (aw = 12.5%~18% moisture content). This resulted in between approx. 10% DML at 25 and 30 ℃ after 5 days storage. Inoculation and storage of shelled hazelnuts + A. flavus inoculum resulted in similar patterns of respiration with optimal levels at 25~30 ℃ and >0.90 aw. Indeed, AFB1 contamination was highest at the maximum water levels tested of 0.90 aw. Indeed the contamination level exceeded the legislative limits set by the EU for AFB1 contamination of these nuts. Correlation between DMLs and all the AFB1 data in both sets of studies showed that very small changes in DML due to poor drying or storage of ≥0.6% resulted in AFB1 contamination levels exceeding the EU legislative limits. Thus, efficient drying and safe monitored storage is necessary to minimise the risk of AFB1 contamination in this economically important commodity and to avoid exposure of consumers to such toxins.