In this prospective study, 70 patients with pleural effusions were investigated; the underlying disease was identified in 62 of these cases. Employing pre-defined criteria, 31 effusions were identified to be transudates, and 31 exsudates. The total protein, LDH and cholesterol were determined in order to establish their significance for the differentiation between transudates and exsudates. In 11-15% of the cases, the parameters protein and LDH led to a false classification of the effusions. The mean cholesterol concentration in malignant effusions was 94 mg/dl; in inflammatory effusions 76 mg/dl, and in transudates 30 mg/dl. By employing a threshold of 60 mg/dl to distinguish between transudates and exsudates, it proved possible to correctly classify 95% of the effusions. Lipoprotein studies using density gradient analysis revealed that the effusion cholesterol arises out of the serum, and is not a consequence of local cellular degeneration. Our results indicate that the determination of cholesterol levels is a simple and inexpensive method for distinguishing between transudate and exsudate.