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Abstract Background As a component of membrane lipids and the precursor of oxysterols and steroid hormones, reprogrammed cholesterol metabolism contributes to the initiation and progression of multiple cancers. Thus, we aim to further investigate the significances of cholesterol metabolism in lower-grade gliomas (LGGs). Methods The present study included 413 LGG samples from TCGA RNA-seq dataset (training cohort) and 172 LGG samples from CGGA RNA-seq dataset (validation cohort). The cholesterol metabolism-related signature was identified by the LASSO regression model. Bioinformatics analyses were performed to explore the functional roles of this signature in LGGs. Kaplan-Meier and Cox regression analyses were enrolled to estimate prognostic value of the risk signature. Results Our findings suggested that cholesterol metabolism was tightly associated clinicopathologic features and genomic alterations of LGGs. Bioinformatics analyses revealed that cholesterol metabolism played a key role in immunosuppression of LGGs, mainly by promoting macrophages polarization and T cell exhaustion. Kaplan-Meier curve and Cox regression analysis showed that cholesterol metabolism was an independent prognostic indicator for LGG patients. To improve the clinical application value of the risk signature, we also constructed a nomogram model to predict the 1-, 3- and 5-year survival of LGG patients. Conclusion The cholesterol metabolism was powerful prognostic indicator and could serve as a promising target to enhance personalized treatment of LGGs.