Cholesterol is a lipid, or type of fat produced by the liver and derived from various dietary sources. Although often referred to in negative terms, cholesterol plays an essential part in many processes within the body, including formation of cell membranes and nerve linings and in the manufacture of bile acids, fat-soluble vitamins and certain hormones. However, high cholesterol or hypercholesterolemia is strongly associated with significant health issues including heart disease and stroke.