As aging progresses, older adults experience several health changes, including changes in cholesterol levels, which increases their risk for other diseases. Older adults are particularly vulnerable to cognitive impairment and depression, which may be due to several factors. The aim of this study was to evaluate the association between serum cholesterol level and cognitive impairment and depression in older adults. This study used senior cohort data from the National Health Insurance Service of South Korea. A total of 128 371 participants contributed repeated measures to this dataset. Cognitive impairment was measured via a self-reported questionnaire and depression was measured using claim data. Generalized estimating equations were used to identify associations between serum cholesterol level and cognitive impairment and depression, including subgroup analyses by sex. There was no significant association between low-density lipoprotein cholesterol (LDL-C), total cholesterol (TC), or triglycerides (TG) with cognitive impairment. Low high-density lipoprotein cholesterol (HDL-C) was significantly associated with a higher risk of cognitive impairment, whereas high HDL-C was associated with lower cognitive impairment. Higher LDL-C was significantly associated with lower depression. Higher TC also was significantly associated with depression. HDL-C is associated with depressive symptoms, and may be a key factor in predicting psychiatric symptoms or cognitive decline. Our study suggest that routine health screenings may aid in the early detection of high-risk individuals. © 2020 John Wiley & Sons Ltd.