Abstract: The process for reducing sterols and free fatty acids from animal fat entails forming an oil-in-water emulsion using a mixing device such as a pump or an in-line mixer; and then pumping the emulsion through a conduit for a period of time. The emulsion is made from water, liquefied animal fat and cyclodextrin. The mixing device forms the emulsion in less than one minute; and the emulsion is pumped through the conduit for 5 to 60 minutes. During the time that the emulsion is moving through the conduit, the sterols and free fatty acids move from the fat phase to the water phase and form complexes with the cyclodextrin. These complexes are fairly stable and can be separated from the emulsion by centrifugation. The resulting fat has a reduced sterol and free fatty acid content.