Cholesterol is positioned in the Lipid bilayer parallel to the fatty acid chains of the phosopholipids, and the hydrophilic hydroxyl group interacts with the hydrophilic head of the phospholipid, . Cholesterol is needed in the membrane to alter the fluidity of the bilayer which affects the function of the membrane and therefore the specific cell. Cholesterol can increase the rigidity of the cell membrane, by doing this the membrane becomes less permeable to water soluble molecules. However it is important to remember that it doesn't make the membranes less fluid. At high concentration cholesterol prevents the hydrocarbon chains in the membrane from crystallizing. High concentrations are found in most eukaryotic cells for example the liver cell and red blood cells.  It is also inportant in the production of steriodal hormones, including male and female sex hormones, Vitamin D and producing Bile Salts in the Liver. It can also plan an important role in the Myelin Sheath in neurones 
There are two main types of Cholesterol and two minor types:
LDL - Low density lipoproteins (good cholesterol)
HDL - High density lipoproteins (bad cholesterol)
VLDL - Very low density lipoproteins (very bad forms of cholesterol)
Chylomicrons - carry very little cholesterol, but a lot of triglycerides.
Cholesterol in high density forms can cause such problems as cardiovascular disease and in excess lower density forms can cause Atherosclerosis.
Cholesterol levels can increase with:
- Diets high in saturated fats or trans fats
- A sedentary lifestyle 
(2) Alberts, Johnson, Lewis, Morgan, Raff, Roberts, Walter (2015). Molecular Biology of The Cell. 6th ed. New York: Garland Science. 571.
- ↑ Berg J, Tymoczko J, Stryer L (2012), Biochemistry, seventh edition, W.H. Freeman and Company, Basinstoke. p362
- ↑ Alberts, Johnson, Lewis, Morgan, Raff, Roberts, Walter (2015). Molecular Biology of The Cell. 6th ed. New York: Garland Science. 571.
- ↑ Miezam Cayrol, Enzine Articles. (2007, Dec 12) http://ezinearticles.com/?Knowing-Cholesterol-and-Its-5-Main-Functions&amp;amp;amp;amp;amp;amp;id=869678
- ↑ WebMD, LLC (2009) http://www.webmd.boots.com/cholesterol-management/guide/understanding-cholesterol-problems-basics