The present study was carried out with the objectives to determine the occurrence of aflatoxin M1 (AFM1) in raw milk and identification of associated risk factors from three different types of animal farming systems. A total of 189 pooled raw milk samples were tested for AFM1 with enzyme linked immunosorbant assay (ELISA) as screening and high performance liquid chromatography with fluorescence detection (HPLC-FLD) as confirmatory techniques. AFM1 was found positive in 58% pooled milk samples with the mean level of 0.917 µg/L, while 50.8% and 36.5% samples were found above the legal limits set by European Commission (EC) and Food safety and standard authority of India (FSSAI), respectively for AFM1 in milk. Among all investigated risk factors, feeding of readymade concentrate feed and leftover household cereals, longer feed storage duration and feed storage quality were found significantly associated with presence of AFM1 in farm milk. High prevalence as well as levels of AFM1 in farm milk poses a health risk to the consumers especially children. Therefore, efforts are urgently required to create awareness among dairy farmers about aflatoxins contamination of feed and milk, to improve farm management practices and to control AFM1 level in milk below the legal limits.