Enzymatic oxidation of cholesterol generates numerous distinct bile acids which function both as detergents that facilitate the digestion and absorption of dietary lipids and as hormones that activate five distinct receptors. Activation of these receptors alters gene expression in multiple tissues, leading to changes not only in bile acid metabolism but also in glucose homeostasis, lipid and lipoprotein metabolism, energy expenditure, intestinal motility, bacterial growth, inflammation, and in the liver-gut axis. This review focuses on the present knowledge regarding the physiologic and pathologic role of bile acids and their immunomodulatory role, with particular attention to bacterial lipopolysaccharides (endotoxins) and bile acid and immunological disorders. The specific role that bile acids play in the regulation of innate immunity, various systemic inflammations, inflammatory bowel diseases, allergy, psoriasis, cholestasis, obesity, metabolic syndrome, alcoholic liver disease, and colon cancer will be reviewed.