The removal of the ear canal wall results in: 

a space, the "mastoid cavity", which is less likely than the original ear canal to resist infection;
exposure of the ossicles, which may allow the subsequent formation of a new cholesteatoma deep to the ossicles. To prevent this, these ossicles must be removed, which may diminish the patients hearing.The formation of a mastoid cavity by removal of the canal wall is the simplest and most effective procedure for facilitating the removal of cholesteatoma, but may bestow the most lasting infirmity due to loss of ear function upon the patient treated in this way. The following strategies are employed to mitigate the effects of canal wall removal:

Careful design and construction of the mastoid cavity. This is essential for the health and integrity of the protective sheet of migrating, keratising epithelium which lines the distorted ear canal. This requires the surgeon to saucerise the cavity. A high facial ridge and an inappropriately small cartilaginous meatus are obstructions to epithelial migration and are particularly high risk factors for failure of the self-cleaning mechanism of the external ear. Partial obliteration of the mastoid cavity. This can be performed using a wide range of materials. Many of these resorb in time, which means that the long-term results of such surgery are poorer than the short-term results. Reconstruction of the ear canal wall. Canal wall reconstruction has been performed using ear canal skin alone, fascia, cartilage, titanium as well as by replacing the original intact wall.
Cholesteatoma is a destructive and expanding growth consisting of keratinizing squamous epithelium in the middle ear and/or mastoid process. Cholesteatomas are not cancerous as the name may suggest, but can cause significant problems because of their erosive and expansile properties. This can result in the destruction of the bones of the middle ear (ossicles), as well as growth through the base of the skull into the brain. They often become infected and can result in chronically draining ears. Treatment almost always consists of surgical removal. Signs and symptoms
Other more common conditions (e.g. otitis externa) may also present with these symptoms, but cholesteatoma is much more serious and should not be overlooked. If a patient presents to a doctor with ear discharge and hearing loss, the doctor should consider cholesteatoma until the disease is definitely excluded. Other less common symptoms (all less than 15%) of cholesteatoma may include pain, balance disruption, tinnitus, earache, headaches and bleeding from the ear. There can also be facial nerve weakness. Balance symptoms in the presence of a cholesteatoma raise the possibility that the cholesteatoma is eroding the balance organs in the inner ear. Doctors initial inspections may only reveal an ear canal full of discharge. Until the doctor has cleaned the ear and inspected the entire tympanic membrane, cholesteatoma cannot be diagnosed. Once the debris is cleared, cholesteatoma can give rise to a number of appearances. If there is significant inflammation, the tympanic membrane may be partially obscured by an aural polyp.