Aflatoxin contamination in groundnut is an important qualitative issue posing a threat to food safety. In our present study, we have demonstrated the efficacy of certain good agricultural practices (GAPs) in groundnut, such as farmyard manure (5 t/ha), gypsum (500 kg/ha), a protective irrigation at 90 days after sowing (DAS), drying of pods on tarpaulins after harvest in farmers’ fields. During 2013–2015, 89 on-farm demonstrations were conducted advocating GAPs, and compared with farmers’ practices (FP) plots. Farmers’ awareness of GAPs, and knowledge on important aspects of groundnut cultivation, were also assessed during our experimentation in the selected villages under study. Pre-harvest kernel infection by Aspergillus flavus, aflatoxin contamination, and pod yields were compared in GAPs plots, vis-à-vis FP plots. The cost of cultivation in both the plots was calculated and compared, based on farmer’s opinion surveys. Results indicate kernel infections and aflatoxins were significantly lower, with 13–58% and 62–94% reduction, respectively, in GAPs plots over FP. Further, a net gain of around $23 per acre was realized through adoption of GAPs by farmers besides quality improvement of groundnuts. Based on our results, it can be concluded that on-farm demonstrations were the best educative tool to convince the farmers about the cost-effectiveness, and adoptability of aflatoxin management technologies.