Cholesterol oxidases are bifunctional flavoenzymes that catalyze the oxidation of steroid substrates which have a hydroxyl group at the 3beta position of the steroid ring system. The enzyme is found, in a wide range of bacterial species, in two forms: one with the FAD cofactor bound noncovalently to the enzyme; and one with the cofactor linked covalently to the protein. Here we discuss, compare and contrast the salient biochemical properties of the two forms of the enzyme. Specifically, the structural features are discussed that affect the redox potentials of the flavin cofactor, the chemical mechanism of substrate dehydrogenation by active-center amino acid residues, the kinetic parameters of both types of enzymes and the reactivity of reduced enzymes with molecular dioxygen. The presence of a molecular tunnel that is proposed to serve in the access of dioxygen to the active site and mechanisms of its control by a 'gate' formed by amino acid residues are highlighted.