Background: Mycotoxins are metabolites produced by phytopathogenic and spoilage fungi in animal feed as a result of poor storage. The mycotoxins can also originate in the field and are excreted in milk when dairy animals consume such feeds, posing a public health risk concern. Methods: The aim of this study was to conduct a risk assessment in the informal sub-value chains of rural and peri-urban dairy systems in Nakuru County, by determining the prevalence and quantity levels of mycotoxins in animal feeds and milk. A total of 74 animal feed samples and 120 milk samples were simultaneously collected from individual cows and actors in the informal dairy value chain. Feed samples were analyzed for Aflatoxin B 1 (AFB 1) and Deoxynivalenol (DON) while milk samples were analyzed for Aflatoxin M 1 (AFM 1) using commercial Enzyme Linked Immune Sorbent Assay (ELISA) method. Results: Aflatoxin B 1 contamination levels in 56 % (41/74) of the animal feeds exceeded the European Union (EU) limits of 5 μg/kg ranging between 0 and 147.86 μg/kg. Deoxynivalenol (DON) was identified in 63 % (27/43) of all the animal feeds ranging between 0 and 179.89 μg/kg. In the peri-urban dairy system, 48.5 % (33/68) of the milk samples were contaminated with the AFM 1 concentration above the EU regulation of 0.05 μg/L ranging between 0.017 and 0.083 μg/L. All milk samples from the rural dairy system had AFM 1 contamination levels below the EU limits of 0.05 μg/L ranging between 0 and 0.041 μg/L. Linear regression model showed significant association of abiotic factors; pH, water activity and moisture content of animal feed with AFB 1 and DON contamination of the animal feeds. Conclusions: The results obtained from this study indicate that the peri-urban dairy farms, where intensive management predominate face the challenge of quality feeds, and one contributing factor is the on-farm production and handling of animal feeds.