Family physician recognition and treatment of severe hypercholesterolemia was determined in a residency program by chart audit. Two hundred seventeen clinic patients were identified as having cholesterol levels greater than 260 mg/dL. In only 47 percent of cases was the abnormality noted in the clinic record. Sixty-nine percent of the patients received no treatment, 29 percent were treated with diet, and 7 percent with drug therapy. Family physicians were much more likely to recognize and somewhat more likely to treat hypercholesterolemia if the level was greater than 305 mg/dL and, therefore, marked as abnormal on the laboratory report. An educational program to improve physician management of hypercholesterolemia had no significant effect. Although further education using different teaching approaches may be helpful, the use of optimal rather than statistically "normal" cholesterol ranges by the laboratory may be a better way to improve physician performance.