The present study was conducted to determine whether or not aflatoxin B1 was an effective inducing agent for lysogenic bacteria and to characterize some of the parameters involved in induction. A lysogenic strain of Bacillus megaterium (NRRL-B-3695) and an indicator strain of this species (NRRL-B-3694) were used. Cultures of the lysogenic strain were incubated for various periods of time in the presence of aflatoxin B1. Plaque-forming units as well as colony-forming units were then determined. Results of the present study indicated that bacteriophage lysogenizing B. megaterium could be induced with aflatoxin B1. The optimum concentration for induction was 25 micrograms of toxin per ml of early-log-phase culture. Evidence suggested that: (i) higher concentrations of aflatoxin B1 formed hydrophobic complexes which would not efficiently induce B. megaterium; (ii) the toxic effect of aflatoxin B1 severely limited the number of cells which could be induced prior to killing action of the toxin; and (iii) concentrations less than 25 micrograms of aflatoxin B1 per ml were not efficient inducers of bacteriophage production nor did they demonstrate the toxic effect observed at higher concentrations.