This study aimed to investigate Aflatoxin-M1 (AFM1) contamination in pasteurized and raw milk samples consumed in Kerman and Rafsanjan in southeastern Iran. In this cross-sectional study, a total of 100 samples of raw (n = 67) and pasteurized (n = 33) milk were randomly collected from retail stores, supermarkets, and milk transport tankers in the winter of 2020 and the summer of 2021. The level of AFM1 contamination in the collected samples was evaluated by high-performance liquid chromatography with fluorescence detection (HPLC-FD). AFM1 was detected in 95% of samples and its median concentration was 17.38 ng/L. The median concentration of AFM1 in the pasteurized milk samples (24.89 ng/L) was significantly higher than in the raw milk samples (13.54 ng/L). The AFM1 contamination level in 20% (raw = 13% and pasteurized = 7%) of the samples was higher than the maximum permitted level (MPL) recommended by the European Union (i.e., 50 ng/L), whilst 4% (raw = 3% and pasteurized = 1%) of the samples was higher than the Iranian maximum standard limit (i.e., 100 ng/L). The hazard index (HI) was higher than 1 in 16%, 18%, and 35% of total milk samples for men, women, and children, respectively. The AFM1 contamination level in the milk samples collected in southeastern Iran was worrying. The margin of exposure (MoE) values were lower than 10,000 for children. Because aflatoxins are among the most potent carcinogens known, prevention of milk contamination in all stages from the farm to the table can considerably reduce the community's exposure to AFM1 and its consequent health risks.