Saturated fats are widely seen as undesirable components of a healthy diet, as a result of their illusory association with elevated serum cholesterol. The regulation of serum cholesterol is now better understood and a lack of polyunsaturated fatty acids, rather than an abundance of saturated fatty acids, is responsible. Palmitic acid was shown to incite inflammation at unnaturally high concentrations in tissue culture, but later was found to play an auxiliary role as a precursor to ceramide biosynthesis and possibly in the palmitoylation of membrane receptors involved in the initiation of inflammation. Studies of arthritic inflammation in lab animals showed that dietary saturated fats are anti-inflammatory, whereas polyunsaturated oils are pro-inflammatory. Inflammation plays a role in numerous metabolic diseases, including insulin resistance, fatty liver disease and metabolic syndrome, among others. Fat, as triglycerides in adipose tissue, is an efficient way for living organisms to store energy and reduce the toxicity of other macronutrients. Macronutrients, such as excess carbohydrates and polyunsaturated fatty acids, are converted to saturated and monounsaturated fatty acids for storage as triglycerides in adipose tissue. Fatty acids are released from adipose tissue during fasting and as a result of some metabolic disorders, where elevated levels of nonesterified fatty acids in blood can lead to hepatic lipid accumulation, inflammation and insulin resistance. Although most serum nonesterified fatty acids may be saturated fatty acids, they are not necessarily derived from the diet. This paper will attempt to clarify the role of saturated fatty acids, and palmitic acid in particular, with regard to certain adverse health conditions.