The rationale, safety, and efficacy of cholesterol gallstone dissolution by orally administered ursodiol, chenodiol, or a combination of the two agents are summarized herein. Bile must be supersaturated in cholesterol for gallstones to form, and desaturation of bile by orally administered bile acids induces gradual stone dissolution. The mechanism of action of the two agents differs, but both cause a decreased input of cholesterol into the metabolic pool. Ursodiol is free of side effects, and the combination with chenodiol is equally efficacious and also has few side effects. Chenodiol, although an effective desaturation agent, causes diarrhea, mild reversible hepatic injury, and a small increase in the plasma cholesterol level. Extracorporeal shock-wave lithotripsy decreases gallstone size markedly and thereby increases the speed of dissolution by orally administered bile acids. Medical therapy with oral bile acids is appropriate for patients who present with small cholesterol stones and for patients with larger cholesterol gallstones who cannot or will not have surgery. Oral bile acids may also be valuable in the treatment of gallstone recurrence before it has become symptomatic or to prevent recurrence after prior successful dissolution of recurrent stones.