Cholesteatomas can be subclassified into genuine and acquired forms. Whilst epidermoid formations are the generally accepted cause of genuine cholesteatomas, metaplasia, immigration, proliferation and retraction pocket theories have all been proposed to explain the development of acquired cholesteatomas. Clinically, paediatric cholesteatomas exhibit more extensive and aggressive growth than those arising in adulthood. Molecular biological differences in terms of angiogenesis, cytokine expression and particularly the more marked inflammatory responses of the perimatrix could potentially explain these clinical differences. The surgical therapy of paediatric cholesteatomas should be adapted to the individual pathological findings, although where possible a canal wall up procedure is preferred during initial surgery. The "inside-out" mastoidectomy tracking-technique combines the benefits of a good surgical overview with those of a physiological postoperative auditory canal.