Groundnut (Arachis hypogaea L.) is an important oilseed crop rich in edible oil, proteins, vitamins, and minerals, contributing significantly to human nutrition as well as improves soil fertility through nitrogen fixation. In the present investigation, pH and moisture content of collected groundnut seeds was 6.71 and 23.82% respectively. Groundnut seeds were found highly prone to fungal infestation during storage. Mycological examination of stored groundnut seeds revealed a total of 1194 isolates from six different known genera and also including some unidentified forms. Aspergilli were predominance including Aspergillus flavus, A. fumigates, A. Niger, and A. terreus. The highest relative density was recorded in A. flavus (25.29%) followed by Penicillium spp. (18.26%) and A. Niger (13.14%), whereas the lowest relative density was found in Alternaria spp. (3.01%) next to unidentified fungi (3.52%). The Ocimum basilicum essential oil (OBEO) exhibited potent antifungal activity against A. flavus and its minimum inhibitory concentration (MIC) was recorded at 2.0 µl/ml. The OBEO also exhibited broad fungitoxic spectrum against 8 storage fungi recovered from groundnut seeds. The study highlights the potential of OBEO as an eco-friendly and effective phytopreservative for improving the storage quality and safety of groundnut seeds.