Aspergillus flavus (A. flavus) is one pathogenic fungus that severely endangers human health and food safety. In our previous work, paeonol, a natural active compound from Paeonia. spp can inhibit the growth of A. flavus, and the mode of action is involved with targeting cell walls and cell membranes. In the present work, we have found out that paeonol reduced ergosterol content and perturbed the redox system of A. flavus. Furthermore, paeonol effectively restrained the production of both aflatoxin B1 and aflatoxin B2 on A. flavus inoculated rice. To reveal a whole regulation of paeonol on the transcription level, RNA-seq analysis was conducted. In combination with real-time quantitative PCR, the relative expressions of several key genes participating in ergosterol biosynthesis (erg1, erg4, erg5, erg9, erg11, erg24, and erg25), redox system (cat,mnSOD, and hyr1), oxylipins (ppoA and ppoC), global regulators (veA, velB, and laeA), and aflatoxin biosynthesis (up to 22 genes) were regulated significantly by paeonol treatment. This study not only showed that paeonol could strongly inhibit the growth of A. flavus and the production of its secondary metabolites, but also provided new insights into the antifungal mechanism of paeonol against A. flavus.