In-season crop water stress monitoring is vital in peanuts (Arachis hypogaea L.) to optimize irrigation and reduce pre-harvest aflatoxin contamination risk. This study evaluated UAS-based thermal imagery for detecting spatial and temporal variability in water stress and its relation to pre-harvest aflatoxin risk. In 2025, empirical wet and dry baselines for the Crop Water Stress Index (CWSI) were developed across irrigation treatments in two experimental fields using UAS thermal data and ground physiological measurements. Stressed plants reached canopy temperatures up to 9°C above air temperature, while well-watered canopies were as low as 4°C below the air temperature. A second study across five commercial fields (2023–2024) showed positive correlations between thermal indices (ΔT, CWSI) and aflatoxin contamination levels, particularly under prolonged late-season stress, although overall aflatoxin levels for all fields in both years were below 4 ppb, considered low risk. Overall, UAS thermal sensing is validated as an effective technology for precise water-stress monitoring and shows great potential for pre-harvest aflatoxin contamination risk assessment in peanut fields.