As part of a comprehensive study looking at consumer awareness of nutrition labelling, this descriptive market research evaluated the understanding and use of label information about fat and cholesterol. Mall intercept interviews of 149 food shoppers (80% women, 20% men) revealed that 60% believed it is extremely or very important to reduce their dietary fat. However, the claims "low in saturated fat" and "no cholesterol" and the term "non-hydrogenated" were often misunderstood. Fifty to 66% of respondents correctly interpreted "% B.F./M.F.", "low fat" versus "reduced in fat" claims, and the fat content of margarines. Only 18% used % B.F. information to choose cheese and yoghurt. Depending on the claim, 34-56% of respondents reported consulting other label information along with the claim; with the lowest rate of "additional consultation", (34%) reported for the "no cholesterol" claim. Consumer education is needed to enhance understanding and use of fat and cholesterol label information.