What are the good and bad cholesterol ?
Original Answer (posted originally as a Comment)

It is now accepted that high cholesterol causes atherosclerosis. Cholesterol a major component of the plaques that block arteries. 'Good' and 'bad' cholesterol refer to the way cholesterol is transported in the bloodstream. 

'Bad' cholesterol is cholesterol in the form of low density lipoproteins or LDL, and 'good' cholesterol is in the form of high-density lipoproteins or HDL. 

Or at least that is how it used to be. It is still accepted that high concentrations of LDL in blood promote atherosclerosis, that is high levels of LDL may still be considered 'bad', but drugs that specifically raise the levels of HDL have had serious adverse effects. 

Check out this great article: Cholesterol and Controversy: Past, present and Future by  Jeanne Garbarino, especially the section on "Deconstructing Cholesterol: “Bad” is still bad, but is “good” still good?". It is hard to know what the current position is. And check out the work of Brown and Goldstein.

Edit

Goldstein, in his Nobel lecture, famously said (see here) 


  Cholesterol is a Janus-faced molecule. The very property that makes it useful in cell membranes, namely its absolute insolubility in water, also makes it lethal. For when cholesterol accumulates in the wrong place, for example within the wall of an artery, it cannot be readily mobilized, and its presence eventually leads to the development of an atherosclerotic plaque. 


Cholesterol may be synthesized in the body, or obtained from the diet.  The site of biosynthesis is mainly the liver. Cholesterol and fats (triacylglycerols) are transported in the bloodstream as lipoprotein particles, which may be roughly described as a lipid core surrounded by a protein coat, and may be viewed as a mechanism for transporting insoluble fat molecules (by 'coating' them with a soluble protein exterior). 

There are five main classes of lipoprotein particles (see, for example, Berg): chylomicrons, very low density lipoproteins (VLDL), intermediate-density lipoproteins (IDL), low-density lipoproteins (LDL), and high-density lipoproteins (HDL)

Cholesterol (and fats) are transported from the liver to other tissues in the form of low-density lipoproteins (LDL).  High-density lipoproteins, on the other hand, pick up cholesterol and fats in the blood and from specialized cells and transport them to the liver. Hence the names 'bad' and 'good' cholesterol.  (In reality, of course, things are more complex than this simple scenario: for a very readable account, see Berg).

The ratio of 'bad' to 'good' cholesterol, ie the ratio of LDL to HDL may be used diagnostically, and a healthy LDL/HDL ratio is about 3.5 (see Berg), but in view of the studies cited by Garbarino a low ratio due to high concentrations of HDL (rather than low LDL) might not be so great either. In fact, if LDL is in check, there may be no benefit to raising HDL (Garbarino article).  But I suppose the physicians will always find a way to waffle (and to charge for the privilege).

It is a common misconception that plants do not contain cholesterol. (My original answer to this question attempted to promulgate this nonsense). In particular, plant membranes do contain cholesterol. However, the amount of cholesterol in plants is low compared to that found in animals (Behrman &amp; Gopalan, 2005).  But it is certainly not zero. The nucleus of maize shoots contain significant amounts of cholesterol, for example (Kemp &amp; Mercer, 1968). 

This great reference, Cholesterol in Plants, by Behrman &amp; Gopalan (2005) suggests that the following paragraph should be inserted into biochemistry texts.


  More than 250 steroids have been described in plants.
  Of these,  perhaps  sitosterol,  which  differs  from  cholesterol by an ethyl substituent at position 24, is the most
  common.  But  plants  also  contain  cholesterol  both  free
  and esterified. Cholesterol occurs as a component of plant
  membranes  and  as  part  of  the  surface  lipids  of  leaves
  where it is sometimes the major sterol. The quantity of
  cholesterol is generally small when expressed as percent
  of  total  lipid.  While  cholesterol  averages  perhaps  50
  mg/kg total lipid in plants, it can be as high as 5g/kg
  (or more) in animals.


A great generalization is the following (Behrman &amp; Gopalan, 2005)


  Prokaryotes do not contain cholesterol


These authors also suggest that one of the reasons for the common misconception that plants do not contain cholesterol is "legalities of food labeling that allow small quantities of cholesterol in foods to be called zero".  

I suppose we should not be too surprised that plants can make cholesterol. They can of course, make steroids, the Mexican yam being the original source of a precursor of a particularly important one.  

A key enzyme in the biosynthesis of cholesterol is HMG-CoA reductase, which is the target for statins, and these drugs  may be used to lower serum cholesterol levels (but there may be side-effects).

One interesting thing about the biosynthesis of cholesterol is that the final cyclization step requires oxygen which has lead to much philosophical and evolutionary debate (see, for example, here).

Finally, another quote from Goldstein


  Cholesterol is the most highly decorated small molecule in biology. Thirteen
  Nobel Prizes have been awarded to scientists who devoted major parts of their
  careers to cholesterol. Ever since it was first isolated from gallstones in
  1784, almost exactly 200 years ago, cholesterol has exerted a hypnotic fascination for scientists from the most diverse domains of science and medicine