How does eating oatmeal lower your cholesterol?

Trap. Oatmeal is a fiber rich grain that is able to trap some fat from the gastrointestinal tract and therefore prevent its absorption leading to decrease in cholesterol. It works like a broom to propel junk out.
Minimally. It has soluble fiber that soaks up free cholesterol so that you can get rid of it. However, to lower your cholesterol, you would have to eat an unnaturally high amount of oatmeal every day. Technically, the claim is true but it's misleading. If you still eat crap the rest of the day and don't exercise, the cholesterol won't drop at all. Oatmeal is part of a lifestyle change.