Aflatoxin M₁ (AFM₁) is harmful metabolite that is transferred to milk; therefore, effective mitigation strategies are needed to reduce exposure. Consequently, the objectives were to evaluate an aluminosilicate clay, Alquerfeed Antitox, as a sequestering agent in dairy diets contaminated with aflatoxin (AF), and to determine liver enzyme response to an AF challenge. Twelve primiparous Holstein cows (279 ± 87.8 DIM and 632 ± 51 kg BW) were used in replicated 3 × 3 Latin squares with 21-d periods (d 15–21 were considered for data collection). Treatments were: 1) Control (CON), consisting of a basal TMR; 2) aflatoxin diet (AF), consisting of CON + AF challenge (100 µg of AFB₁/kg DM); and 3) AF + aluminosilicate clay (AF+C), consisting of AF + clay at 0.10% dietary DM. Feed intake and milk yield were recorded daily, blood samples were collected on d 21 of each period, and milk samples were collected on the last 2 d of each period. Data were analyzed using the MIXED procedure of SAS with square, period within square and treatment as fixed effects and cow within square as a random effect. Milk yield and DMI were similar (P ≥ 0.25) across treatments averaging 26.8 ± 1.34 kg/d and 24.0 ± 0.92 kg/d, respectively; milk composition was also similar across treatments (P ≥ 0.18). Compared with CON, addition of AF and AF+C had no effect on blood concentration of alanine aminotransferase (61.1 ± 3.54 IU/L; P = 0.93), aspartate aminotransferase (72.6 ± 5.46 IU/L; P = 0.26), and γ-glutamyltransferase (77.4 ± 6.98 IU/L; P = 0.34). No AFM₁ was detected in CON cows; addition of clay reduced (P ≤ 0.01) concentration of AFM₁ in milk from 1.57 to 1.14 ± 0.10 µg/L for AF and AF+C, respectively. Excretion of AFM₁ was reduced (P ≤ 0.01) by 11.64 ± 4.36 µg/d, transfer was also reduced with AF+C (P ≤ 0.01; 1.65 vs 1.19 ± 0.13%) compared with the AF diet. Lack of response on liver enzymes after prolonged exposure suggests that evaluating liver function earlier in the challenge phase may be a better approach. These results demonstrate that the inclusion of aluminosilicate clay reduces absorption and transfer of dietary aflatoxin to milk.