Sebum is the oily secretion produced by tiny sebaceous glands in the scalp. The sebum produced by these glands lubricates the skin and hair. They are found everywhere on the body except the palms and soles of the feet.
Over-production of sebum produces oily hair and complexion, under-production produces dry hair and skin. Wikipedia says that these glands are involved in conditions like acne, where a plug is created in the pore, blocking the pore, and causing inflammation. A blocked sebeceous gland can result in a sebaceous cyst or wen - which is fairly common in hairy parts of the body and is normally not a problem.
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