Cholesterol has evolved to fulfill sophisticated biophysical, cell signaling and endocrine requirements of animal systems. At a cellular level, cholesterol is found in membranes, where it increases both bilayer stiffness and impermeability to water and ions. Furthermore, cholesterol is integrated into specialized lipid-protein membrane microdomains with critical topographical and signaling functions. At an organismal level, cholesterol is the precursor for all steroid hormones, including gluco- and mineralo-corticoids, sex hormones and vitamin D, all of which regulate carbohydrate, sodium, reproductive and bone homeostasis, respectively. This sterol is also the precursor for bile acids, which are important for intestinal absorption of dietary lipids as well as energy and glucose metabolic regulation. Importantly, complex mechanisms maintain cholesterol within physiological ranges and the disregulation of these mechanisms results in embryonic or adult diseases, caused by either excessive or reduced tissue cholesterol levels. The causative role of cholesterol in these diseases has been demonstrated by diverse genetic and pharmacologic animal models that are commented in this review.