Xanthoma of bone is a rare benign primary bone disorder with a hallmark of cholesterol deposition in the bone frequently seen in men and in patients over 20 years of age. This mini review provides an overview of the known clinical, radiological and pathological features of the disease which can mimic primary bone tumors or metastatic lesions. In this review, we focus on the current considerations in the use of clinical and radiological features, lipid profile and histopathological study for the definitive diagnosis. Despite this wealth of features, the definitive diagnosis of bone xanthoma continues to be difficult. The current status of biopsy technique, treatment, outcome and prognosis of bone xanthoma are also reviewed, highlighting recent successes and ongoing challenges. The review is concluded with the recommendations of the Evidence-Based Management of bone xanthoma. Despite improvements in imaging, biopsy technique and the delivery of treatment, the diagnosis has remained challenging for orthopedic surgeons to differentiate it from other bone benign and aggressive lesions.