I am going thru BG for the second time and have come across a strange thing. When I go into the area of BG that has the Flaming Fist fortress, there are some(not all) peasants that have turned hostile(red circles). They don't attack me, and I don't attack them(I leave the AI turned off).Anyone ever seen this before?

If an Innocent sees you attack another Innocent, fail a pickpocket against someone, or otherwise defy the law, they can/will turn Hostile to you. This includes things like resisting arrest--even if you don't hit back.

Do you mean it's the second time you're visiting Baldur's Gate in this run through the game? If that's the case, then everything is fine. The peasants will turn hostile because you're apparently a murderor on the loose.

Thanks Six, that's probably it. I resisted arrest in that area back before I chased Sarevok away to the undercity. I guess the peasants never got the word. Now,,,,where IS that BG2 town crier???