Olive oil was traditionally produced by beating the trees with sticks to knock the olives off and crushing them in stone or wooden mortars or beam presses. Nowadays, olives are ground to tiny bits, obtaining a paste that is mixed with water and processed by centrifugation, separating the oil from the pomace (the other remaining substances).

Edible commercial olive oil can be divided into several categories according to its chemical characteristics and the production method: Extra Virgin Olive Oil, Virgin Olive Oil, and Olive Oil. The first two, virgin olive oils, are obtained only by physical extraction from the fruits. Non virgin olive oil is obtained by the chemical refining of a low-quality non-edible grade of virgin olive oil called "lampante" olive oil.

A second type of oil can be extracted from the remaining pomace. This is called Olive Pomace Oil and it is obtained, like all the other food oils, by treatment with a chemical solvent, generally hexane, and subsequent chemical refining.

Of all the categories, extra virgin olive oil presents the highest organoleptic, nutritional, and health qualities, as well as the most "flowery" taste. Today olive oil is mainly used in cooking and also in cosmetics and soaps, but it has been used for medicines and as a fuel for oil lamps.

"Cold Pressed" Extra Virgin Olive Oil is generally considered the best grade of olive oil. As the name suggests, it is obtained without heating the pressed mass. Heating frees more of the oil but lowers the quality of the resulting oil. Cold Pressed Extra Virgin olive oil is best suited to specialist uses such as salad dressings. Olive oil has a low Smoke point(200°F for fancy flavorful grades, and 400°F for the cheap refined grades) and so is not well suited for cooking at high temperatures. Blended oils containing olive oil are available and combine to make a higher smoke point.

Olive oil is produced in areas that have a Mediterranean climate. Large producers of olive oil include Turkey Greece, Italy, France, Spain, and California.