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Almost any fat laden food can become rancid, or degraded by hydrolysis or oxidation (technically "oxidative rancidity"). In hydrolysis the fatty acid chains in the glycerides are split away from their glycerol backbones. In oxidation, the long-chain fatty acids are damaged and shorter chain compounds are formed. A typical byproduct is butyric acid, which causes the rancid taste.

The term “rancid” is used particularly to refer to oxidized oils which can have altered odor, taste, nutrition and fitness for human consumption. Unsaturated fats are most at risk for oxidation and can, under some conditions, become rancid very quickly.