This study investigated the effects of varying doses of dietary aflatoxin B1 (AFB1) on the growth, intestinal health, and muscle quality of hybrid grouper. Four diets with varying AFB1 concentrations (0, 30, 445, and 2,230 μg kg−1) were used. Elevating AFB1 concentrations led to a decline in growth indexes, specifically the weight gain rate and the specific growth rate, although the survival rate remained unchanged. Morphological indicators showed a dose-dependent decline with AFB1 exposure. Intestinal MDA content and hindgut reactive oxygen species (ROS) levels increased, while antioxidant indexes and digestive enzymes decreased with higher AFB1 levels. AFB1 negatively influenced hindgut tight junction protein and antioxidant-related gene expression while promoting inflammation-related gene expression. The presence of AFB1 in the experiment led to a decrease in beneficial intestinal bacteria, such as Prevotella, and an increase in harmful intestinal bacteria, such as Prevotellaceae_NK3B31_group. Muscle lipid and unsaturated fatty acid content significantly decreased, while muscle protein and liver AFB1 content increased dramatically with higher AFB1 concentrations. AFB1 caused myofibrillar cleavage and myofilament damage, leading to increased spaces between muscle fibers. In conclusion, diets with AFB1 levels exceeding 30 μg kg−1 inhibited hybrid grouper growth, while levels surpassing 445 μg kg−1 resulted in hindgut ROS accumulation, inflammation, elevated intestinal permeability, reduced digestive enzyme activity, and compromised muscle quality.