I have a similar concern, as one of my air conditioners came out of winter storage with black mildewey-looking stuff in that same area. I held my breath and washed it off carefully and it didn't seem to come back over the summer. In your case though, with the way it's flaking and blowing around I'd be inclined to think it some gasket material rotting out. But I'm no expert. You can find a mold remediation company in the yellow pages, but I'd start by going to Home Depot and picking up a mold test. As I recall, they're about $10 and can tell you if it's a potential problem at which point you can mail the sample in for lab analysis.

Based on the information you've provided I don't think it's mold. Some of these airconditioners have a charcoal filter and they sometimes breakdown like this. The chacoal is a coating on the plastic mesh filters and it does come off sometimes as it gets old.
I recommend replacing the filter.

Jakvis,

That makes sense. Where in the ac unit is the Charcoal filter located ? Is that something that I can replace myself or is it a job for a repair person?

This is a customer replaceable item.
The filter is generally just behind the front intake grill.
You may want to consult your manual on how to get to it.

You say it doesn't smell.

If it smells it's probably mold due to the condensation water not evaporating in the bottom tray. Is it installed with a slight tilt to allow drainage? Are the drain holes on the outside clogged?

When was the last time you changed or cleaned the filter? Have you ever cleaned the fins on the outside?

How old are the units?

The units are about 5 to 7 years old. If you stick your nose directly in the area where the air blows in the room, it smell a little musty, but not terrible.
I will check the drainage holes.
I assume they will be on the bottom of the unit out side.

I don't know where these outside fins are or how I would clean them. Do tell.

As for the filter. I do clean it. I thought there was an internal filter that I needed to check. The "dirt chips" have a spongy dry texture. They don't really smell like anything. But they do break up into powder easily when you touch them. and they do look like powdery charcoal when they break up.

Thanks Klaa2 and everyone for your help.

There is a lot of it in the space where the air comes out of. When I look in side this area (by removing the cover), there is a big wheel (looks like a large hamster wheel). I guess that is part of the cooling mechanism. There is a lot of "this stuff" on and around the big wheel. But there are no signs of this stuff on the filter where the air is sucked in from the room.

Any ideas???

On the off chance that you still have this account, wondering if you were ever able to find a solution? I am having the same issue now -- black flecks blowing out of our downstairs wall AC unit that break apart when touched. Filter has been cleaned and didn't solve the issue. Landlord is being stingy about paying for a full unit cleaning, and we are not sure what to do since we don't want to put any furniture, etc under it until this is solved.