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Cholesterol plays an important part in the structure and function of the cell membranes of animals. Because animal cells do not have cell walls to support them, the cell membrane must maintain a strong but flexible surface. Cholesterol molecules inserted among the lipids that make up the membrane prevent the lipids from gelling into a crystal-like, overly organized structure, and so cholesterol keeps the cell membrane flexible.
Cholesterol also adjusts the permeability of the cell membrane, making it less permeable to small water soluble molecules, and giving the cell more control over what materials pass in and out. Without cholesterol in the membrane, a cell would be at risk of absorbing excessive fluids and possibly bursting.
Because of the way cholesterol is shaped, part of the steroid ring (the four hydrocarbon rings in between the hydroxyl group and the hydrocarbon "tail") is closely attracted to part of the fatty acid chain on the nearest phospholipid. This helps slightly immobilize the outer surface of the membrane and make it less soluble to very small water-soluble molecules that could otherwise pass through more easily.
Without cholesterol, cell membranes would be too fluid, not firm enough, and too permeable to some molecules. In other words, it keeps the membrane from turning to mush.
While cholesterol adds firmness and integrity to the plasma membrane and prevents it from becoming overly fluid, it also helps maintain its fluidity.
At the high concentrations it is found in our cell’s plasma membranes (close to 50 percent, molecule for molecule) cholesterol helps separate the phospholipids so that the fatty acid chains will not come together and cyrstallize.
Therefore, cholesterol helps prevent extremes-- whether too fluid, or too firm-- maintaining the integrity and consistent fluidity of the cell surface membrane.
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