Various aspects of groundnut seed deterioration due to M. phaseolina infection were studied. Fungal infection caused both quantitative and qualitative damage to the seed. It resulted in characteristic discoloration of pod and kernel. There was marked reduction in the pod and kernel yield, shelling percentage and oil content. The oil extracted from healthy kernels was barium yellow, whereas, oil from diseased kernels was amber yellow in color. The diseased kernels contained lesser amounts ofstearic and behenic acids but higher quantities of palmitic, oleic, linoleic and arachidic acids. Four fatty acids, namely, lauric, myristic, palmitoleic and eicosenoic acids were absent in diseased kernels.