One of the major diseases that threatens human health all over the world is cardiovascular disease, which has become the leading cause of death in adults in China. Hypercholesterolemia is one of the risk factors for cardiovascular diseases. Statins, cholestyramine and eztimibe are currently used clinically to treat hypercholesterolemia. However, long-term administration of these drugs may cause various side effects. Cholesterol-lowering functional foods have begun to be used as an alternative to drugs since they exert an efficacy similar to that described for drugs without any side effects. The present review discusses the synthesis, metabolism and excretion of cholesterol and how the body modulates plasma cholesterol balance. Additionally, this review summarizes recent studies on cholesterol metabolism and cholesterol-lowering functional foods as well as their active components and action mechanisms.