Policosanol appears to slow down cholesterol synthesis in the liver and increase liver re-absorption of low-density lipoproteins (LDL). Policosanol has also been shown to increase levels of high-density lipoproteins (HDL). Cholesterol is a fat-related substance necessary for good health. It is a normal component of most body tissues, especially those of the brain, nervous system, liver and blood and is needed to form the sex and adrenal hormones, vitamin D and bile; a digestive secretion required for fat digestion. A high level of blood cholesterol, however, increases the likelihood of developing health problems such as heart disease. There are five types of cholesterol, but it is the HDL and LDL cholesterol that we look to in assessing the potential for disease.

HDL, referred to as the “good” cholesterol, has the ability to clear built-up cholesterol from the arteries and help in its removal from the body. LDL, the “bad” cholesterol, is linked to heart disease and is involved in the fatty build-up on artery walls known as atherosclerosis or "hardening of the arteries". Recent research indicates that low HDL levels are a strong predictor of cardiovascular disease.

One of Policosanol’s important actions is to reduce the abundance of cells in the arteries by inhibiting the oxidation of LDL. Oxidized LDL is dangerous. It promotes the destruction of blood vessels by creating a chronic inflammatory response. Oxidized LDL can also provoke metalloproteinase enzymes. These enzymes promote blood vessel destruction, partly by interfering with HDL’s protective effect. Healthy arteries are lined with a smooth layer of cells that permit the blood to pass with no resistance. Unhealthy arteries become overwhelmed with cells, causing the blood passage to narrow and eventually be blocked which can lead to heart attack.