Postharvest application of fungicides is commonly applied in order to reduce food loss. Prochloraz is currently the only postharvest fungicide registered in Israel and Europe in avocado fruits. Due to its unfavorable toxicological properties, prochloraz will be banned from the end of 2020 for future postharvest usage and therefore a substitute candidate is urgently warranted. Fludioxonil, a relatively safe, wide spectrum fungicide, is approved in Europe and Israel for postharvest use in various fruits, but not avocado. Hence, fludioxonil has been evaluated in the present study as a potential substitute for prochloraz in avocado. The objectives of the present study were to determine fludioxonil efficacy against common fungal infestations in avocado and distribution kinetics between peel and pulp in comparison to prochloraz. At the same concentration range (75–300 µg/L), fludioxonil was as effective as prochloraz in inhibiting postharvest decay, while in the early season cultivars, suffering mainly from stem-end rot, it exhibited a better decay control than prochloraz. Fludioxonil and prochloraz displayed negligible and undetected pulp levels, respectively, due to low peel penetrability. Taken altogether, fludioxonil was found to be a suitable candidate for replacing prochloraz as a postharvest fungicide in avocado.