This scalp condition is caused by a fungus, Malassezia, which feeds on sebum (the oily matter secreted by the sebaceous glands on our scalp) and the dead skin cells which occur naturally due to formation of new skin. Although this microbe is a normal part of the scalp, this is when it turns problematic- the fungus feeds on sebum, breaking it down into fatty acids that may irritate the sensitive scalp of many. This is also the reason for dryness and itchiness on the scalp, leading to the dead skin cells accumulating into visible flakes. The level of sensitivity of people to these fatty acids determines whether they develop acute or mild dandruff.
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