Abstract The effect of water activity (aw) on rate of autoxidation of raw peanut oil at 37 C was studied. Up to 3 weeks of storage, no marked effect of aw on the rate of peroxide formation was noticeable. However, with prolonged storage, the rate of peroxide formation decreased rapidly at aw of 0.67 and higher as compared to aw of 0.50 and lower. At the end of 9 weeks’ storage, the peroxide value at aw=0.02‐0.50 was in the range of 31–35, while it was only ca. 10 at 0.79 and 0.92 aw. There was no noticeable influence of aw on the rate of free fatty acid formation. The oil stored for 7 weeks at 0.02 and 0.11 aw had fresh flavor, although the peroxide values were high; whereas the oils at 0.79 and 0.92 aw were stale, although the peroxide values were less than 10. The anisidine value at 0.02 aw (348) was higher than at 0.92 aw (62). The carbonyl values at 0.02 and 0.11 aw were also higher (1090, 1021) than at 0.79 and 0.92 aw (573, 780). The results indicate that the protective effect on the oil against peroxide formation at high aw may be due to certain components present in raw peanut oil.