Acyl-coenzyme A:cholesterol transferase (ACAT) is an integral membrane protein localized in the endoplasmic reticulum. ACAT catalyzes the formation of cholesteryl esters from cholesterol and fatty acyl coenzyme A. The cholesteryl esters are stored as cytoplasmic lipid droplets inside the cell. This process is very important to the organism as high cholesterol levels have been associated with cardiovascular disease. In mammals, two ACAT genes have been identified, ACAT1 and ACAT2. ACAT1 is ubiquitous and is responsible for cholesteryl ester formation in brain, adrenal glands, macrophages, and kidneys. ACAT2 is expressed in the liver and intestine. The inhibition of ACAT activity has been associated with decreased plasma cholesterol levels by suppressing cholesterol absorption and by diminishing the assembly and secretion of apolipoprotein B-containing lipoproteins such as very low density lipoprotein (VLDL). ACAT inhibition also prevents the conversion of macrophages into foam cells in the arterial walls, a critical event in the development of atherosclerosis. This review paper will focus on the role of ACAT in cholesterol metabolism, in particular as a target to develop novel therapeutic agents to control hypercholesterolemia, atherosclerosis, and Alzheimer's disease.