Despite the overwhelming prevalence of cholelithiasis, many health care professionals are not familiar with the basic pathophysiology of gallstone formation. This article provides an overview of the biochemical pathways related to bile, with a focus on the physical chemistry of bile. We describe the important factors in bile synthesis and secretion that affect the composition of bile and consequently its liquid state. Within this biochemical background lies the foundation for understanding the clinical and sonographic manifestation of cholelithiasis, including the pathophysiology of cholesterol crystallization, gallbladder sludge, and gallstones. There is a brief discussion of the clinical manifestations of inflammatory and obstructive cholestasis and the impact on bile metabolism and subsequently on liver function tests. Despite being the key modality in diagnosing cholelithiasis, ultrasound has a limited role in the characterization of stone composition.