The present review aims at providing a complete and comprehensive summary of current literature relevant to oxysterols and related diseases. Oxidation of cholesterol leads to the formation of a large number of oxidation products, generally known as oxysterols. They are intermediates in the biosynthesis of bile acids, steroid hormones, and 1,25-dihydroxyvitamin D3. Although oxysterols are considered as metabolic intermediates, there is a growing body of evidence that many oxysterols are bioactive, and their absence or excess may be part of the cause of a disease phenotype. These compounds derive from either enzymatic or non-enzymatic oxidation of cholesterol. This study provides comprehensive information about the structures, formation, and types of the oxysterols even when involved in certain disease states, focusing on their effects on metabolism and linkages with these diseases. The role of specific oxysterols as mediators in various disorders, such as degenerative (age-related) and cancer-related disorders, have now become clearer. Oxysterol levels may be employed as suitable markers for the diagnosis of specific diseases or in predicting the incidence rate of diseases, such as diabetes mellitus, Alzheimer’s disease, multiple sclerosis, osteoporosis, lung cancer, breast cancer, and infertility. However, further investigations may be required to confirm these mentioned debates.