Habermanns theory: The epithelium from the meatus or outer drum surface grows into the middle ear through a pre-existing perforation and form cholesteatoma.Cholesteatoma may also arise as a result of metaplasia of the middle ear mucosa  or implantation following trauma. Diagnosis
Cholesteatoma is diagnosed by a medical doctor by physical examination of the ear. A CT scan may help to rule out other, often more serious causes for the patients clinical presentation. Non-ionizing radiation imaging techniques (MRI) may be suitable to replace a CT scan, if determined necessary by a physician. Treatment
Cholesteatoma is a persistent disease. Once the diagnosis of cholesteatoma is made in a patient who can tolerate a general anesthetic, the standard treatment is to surgically remove the growth. The challenge of cholesteatoma surgery is to permanently remove the cholesteatoma whilst retaining or reconstructing the normal functions of the structures housed within the temporal bone. The general objective of cholesteatoma surgery has two parts. It is both directed against the underlying pathology and directed towards maintaining the normal functions of the temporal bone. These aims are conflicting and this makes cholesteatoma surgery extremely challenging. Sometimes, the situation results in a clash of surgical aims. The need to fully remove a progressive disease like cholesteatoma is the surgeons first priority. Preservation of hearing is secondary to this primary aim. If the disease can be removed easily so that there is no increased risk of residual disease, then the ossicles may be preserved.
The endoscope allows minimally invasive  access through the natural ear canal, rather than through the usual 5 cm incision behind the ear utilized in traditional microscopic surgery. The 30 degrees endoscope allows access to the bony area of the Eustachian tube to address any obstructive pathologies. Prognosis
It is important that the patient attend periodic follow-up checks, because even after careful microscopic surgical removal, cholesteatomas may recur. Such recurrence may arise many years, or even decades, after treatment. A residual cholesteatoma may develop if the initial surgery failed to completely remove the original; residual cholesteatomas typically become evident within the first few years after the initial surgery. A recurrent cholesteatoma is a new cholesteatoma that develops when the underlying causes of the initial cholesteatoma are still present. Such causes can include, for example, poor Eustachian tube function, which results in retraction of the ear drum, and failure of the normal outward migration of skin.In a retrospective study of 345 patients with middle ear cholesteatoma operated on by the same surgeon, the overall 5-year recurrence rate was 11.8%. In a different study with a mean follow-up period of 7.3 years, the recurrence rate was 12.3%, with the recurrence rate being higher in children than in adults. The use of the endoscope as an ancillary instrument has been shown to reduce the incidence of residual cholesteatoma.