Most nutrients obtained through the diet are absorbed in the small intestine. Malabsorption syndromes that interfere with the action of the small intestine also affect the absorption of proteins, vitamins, and fats. Nutrients not absorbed by the small intestine pass through to the colon and are excreted in the stool. Fatty stools, or a high concentration of lipids on the feces, are caused by medical conditions that affect production and secretion of pancreatic enzymes or bile salts, which are necessary for proper fat absorption.

Dietary fats, or triglycerides, require a complex of pancreatic enzymes to be absorbed properly. The most important of these enzymes is a complex called lipase-colipase. Additionally, a specific concentration of bile salts is also necessary. A deficiency in lipase or colipase, or a low concentration of bile acid, will prevent the intestines from absorbing fats.

The pancreatic enzymes split the long molecular chains of triglycerides into smaller fatty acids and monoglycerides. These smaller molecules combine with the bile salts to form micelles, or a cluster of particles. The micelles pass through the cells lining the walls of the small intestine. Triglycerides with medium length chains are absorbed directly by the intestinal walls.

Malabsorption results from any condition that prevents the intestines from properly absorbing dietary fats. Steatorrhea, or fatty stools, occur when more than 0.25 ounces (7 g) of fat are excreted in the stools per day. They appear light-colored and greasy, and they have a foul odor. In many cases, the stools of people with absorption problems are accompanied by diarrhea, gas and abdominal bloating or pain.

Causes of steatorrhea can be grouped into pancreatic insufficiencies or impaired bile production. Examples of conditions that cause pancreatic insufficiencies are pancreatitis, cystic fibrosis, pancreatic cancer, celiac disease or other mucosal diseases and obstructive biliary or cholestatic liver disease. Conditions that impair biliary function include liver or biliary tract disease or inflammation of the ileum. Overgrowth of bacteria in the small intestine might also cause malabsorption and fatty stools by making the bile acid inactive and preventing micelle formation.