Not all dietary fat behaves the same way in the body. The two you'll see referenced most often are monounsaturated fat (found in olive oil, avocados, and nuts) and saturated fat (found in butter, fatty meat, and coconut oil). Here's how they differ.
What makes a fat 'monounsaturated' or 'saturated'
The difference is chemical: monounsaturated fats have one double bond in their carbon chain, which keeps them liquid at room temperature (like olive oil). Saturated fats have no double bonds, which makes them solid at room temperature (like butter).
Effect on cholesterol
Replacing saturated fat with monounsaturated fat in the diet is associated with lower LDL ('bad') cholesterol and, in many studies, stable or improved HDL ('good') cholesterol. Saturated fat, especially in excess, tends to raise LDL cholesterol.
Effect on heart disease risk
Large diet-swap studies consistently show that replacing saturated fat with unsaturated fat (monounsaturated or polyunsaturated) lowers cardiovascular risk more than simply reducing total fat.
Saturated fat isn't 'poison,' but it isn't the star either
Small amounts of saturated fat in an otherwise healthy diet are not typically flagged as a major concern. The issue is a pattern heavy in saturated fat with little monounsaturated or polyunsaturated fat, and often paired with refined carbohydrates.
The practical takeaway
You don't need to eliminate saturated fat entirely. The highest-leverage change for most people is simple: use olive oil as your primary cooking and finishing fat, and treat butter, fatty cuts of meat, and coconut oil as occasional choices rather than daily defaults.