Abstract: Background and Objective: Mycotoxigenic fungi infest stored foods and feeds depending on environmental conditions prevailing in storage specially water activity (aw) prevailing. Besides, physical conditions, the relationship of storage moulds which may act antagonistically or synergistically on individual surface moulds of fodders and feeds which in turn may influence the elaboration of mycotoxins by moulds will determine the degree of mycotoxin contamination. Therefore, it was considered worthwhile to determine the influence of water activity (aw) on mycotoxins elaboration both qualitatively and quantitatively. Varieties of moulds are reported to infest paddy straw and elaborate mycotoxins and cause health hazards to cattle which consume it. Interaction of infesting moulds and water activity (aw) are reported to be complex and determine mycotoxin elaboration. Materials and Methods: The stored paddy straw with different aw activity was inoculated by spore suspension of individual mycotoxigenic fungi and incubated at 30°C for 15 days. Mould infested straw was analyzed for the presence of different mycotoxins. The water activity (aw) of straw was maintained by standard methods. Results: The analysis of mould infested rice fodder revealed the presence of mycotoxin which differed quantitatively depending on the water activity (aw). Moulds present in the rice fodder are likely to interact and act either synergistically or antagonistically and contribute to the management of most mycotoxigenic fungi through biologically and ecofriendly. Conclusion: Management of mycotoxins can be accomplished by maintaining most adverse environmental conditions and promoting antagonistic moulds. As temperature, water activity and pH have a great impact on mycotoxin production by fungi, these factors have to be considered for developing management practices.