Fecal sterols, a class of persistent steroidal biomarkers derived from the anaerobic microbial reduction of Δ5-sterols (e.g., cholesterol) in the gastrointestinal tracts of humans and higher animals, are widely distributed in diverse environmental matrices including lacustrine sediments, peat deposits, and marine sediments. Owing to their relative chemical stability and recalcitrance to degradation, these compounds are preserved long-term in geological systems. Consequently, they serve as critical geochemical tracers for environmental pollution source apportionment and multi-millennial scale paleoecological reconstruction. Their intrinsic molecular stability against biodegradation, coupled with distinctive structural signatures across taxa, provides unparalleled advantages in revealing regional ecological evolution, quantifying modern environmental risks, and exploring the coupling mechanisms between abrupt climate change and human activities. Motivated by the urgent need to refine sterol-based environmental diagnostics, this paper conducted a systematic review of research advances in national and international studies on the investigation of modern processes of feacal sterols and their application in pollution traceability and paleoecology. The review reveals that: (1) Divergent foraging behaviors, digestive system anatomies, and enzymatic conversion efficiencies across taxa lead to species-specific sterol profiles in fecal matter, forming unique “sterol fingerprints”. Based on characteristic sterol ratios (e.g., coprostanol/24-ethylcoprostanol, epicoprostanol/coprostanol, etc.), researchers can effectively differentiate contamination sources and quantify the contribution of human and animal inputs; (2) Methodological advances in organic geochemical analysis have established biomarker compounds as integral proxies for paleobiological and paleoenvironmental reconstructions. Fecal sterols extracted from lacustrine, marine, and peat archives enable the temporal reconstruction of anthropogenic activities and wildlife dynamics, including human demographic fluctuations, pastoralism intensification patterns, and Antarctic penguin population variations throughout historical periods. These applications served as critical proxies for decoding centennial-scale human-environment coevolution mechanisms preserved in sedimentary archives; (3) While fecal sterols, as an emerging biomarker in geoenvironmental research, demonstrate unique value in tracing human activities, paleoecological reconstruction, and identifying contamination sources, inherent limitations and challenges remain. Current challenges include overlapping sterol characteristics among species, the lack of regional baseline databases, interference from post-depositional processes, and poorly constrained quantification frameworks for holistic modern process modeling. Future research needs to strengthen investigations of modern fecal sterol processes across diverse regions and decipher compartment-specific drivers governing sterol pathways from enteric synthesis to sedimentary sequestration. This requires controlled mesocosm experiments simulating regional environmental stressors (e.g., salinity gradients, temperature anomalies). Combining machine learning algorithms, multi-indicator analyses (e.g., sporoderma, ancient DNA), and high-sensitivity detection techniques will optimize classification models and establish a global-scale sterol fingerprint database, thereby improving the accuracy of pollution source tracing and the reliability of paleoecological reconstruction.