Canola oil is a vegetable oil derived from the rapeseed plant, a species of the Brassica genus that includes turnip, mustard, and colewort, a species that includes cabbage, cauliflower, broccoli, and kale; the unfortunate name comes from the Latin "rapum," meaning turnip. The more marketable name comes from its home country of Canada.
(Anyone with a working nose, who enters a rape field in the spring, will come to an alternate etymology of the name.)
Unlike standard rapeseed oil, which has relatively high levels of cardiotoxic fatty acids such as erucic acid, and is used in the West only for industrial purposes, canola is derived from special breeds of the rape plant selected for low levels of erucic acid. Even the typical levels of erucic acid would probably do only slight damage to adults, but the "adults" wouldn't stop whining about its bitter taste, so it was bred out.
Some people who get their knickers in a twist about almost any new food plant don't like canola oil very much, which is a shame because it's a nice substitute for olive oil where the olive flavor would be too much and has a higher smoke point than most oils as light, making it ideal for deep-frying. (It does smell a bit weird when hot though.) It's also got just about the lowest saturated fat content of any cooking oil on the market. Detractors like to refer to it using the strictly correct but blatantly loaded term "rape oil", a choice of terminology that would make Newt Gingrich proud.
Due to objections by PETA, the Bush Administration stopped the practice of renditioning suspected members of al-Qaeda to Turkmenistan, where they have their arms and legs boiled in beef tallow. They now fly them to Uzbekistan for interrogation because that country's secret police uses only 100% canola oil. 
 Processing fears
Most canola oil is processed using Hexane, a known carcinogen. Even the industry admits that some amount of hexane remains in the finished product, but claims the amounts are "insignificant". On the plus side, I now appear to have a lifetime supply of chain lube for my bike.
It's important to note, though, that hexane is used in the processing of many different vegetable oils, not just canola oil. Soybean oil -- and for that matter, soy protein -- are also processed using hexane. The food processing industry is looking into replacing the regular hexane they're now using with isohexane, which has been shown to carry far fewer health risks.
 Genetic modification, oh noes!
All canola is genetically modified food, in the sense that the modern canola plant is the product of selective breeding and cross-breeding. Varieties of rapeseed that produced little or no erucic acid were selected and bred, and their most desirable (i.e. lowest erucic acid) descendants were chosen to breed in the next generation, until the modern plant was produced.
However, starting in the 1990s, new varieties started to be developed by more direct genetic engineering -- i.e. by actual gene splicing/DNA recombination. By the late 2000s, around 90% of all canola seeds planted in the U.S. and Canada carried genes that had been spliced into either their own seeds or the seeds of their ancestors.
Thus far, the only such genetic modification made to canola seeds is the ability to tolerate herbicides (weed killer). This allows canola farmers to kill the weeds that harass their canola crops by spraying the entire field with RoundUp™, without fear of killing their crops with the stuff too. However, pollen from these genetically-modified canola plants soon made its way out into the wild, either because the crops scattered their pollen or because seed-hauling trucks accidentally spilled some of their cargo or both. By 2010, 80% of wild rapeseed plants in North Dakota carried transgenes for herbicide tolerance. This raised concerns that the build-up of herbicide resistance in feral canola could make it more difficult to manage these plants using herbicides.
The gene(s) for herbicide tolerance spliced into the canola plant do, of course, change its protein makeup slightly. However, since it is only the oil of the canola plant that is sold as food, and not any of the protein-bearing portions, the potential for the new GM-introduced proteins to cause allergic reactions has not been investigated. So far as we can tell, the chemical composition of the oil has not changed.
- Snopes.com on canola oil
- Canolainfo.org Processing Canola Oil - Page 6 - Hexane Extraction of Canola
- Wikipedia on Hexane - Use in food processing
- ↑ Or so they™ keep telling you; but according to the Wikipedia entry at http://en.wikipedia.org/wiki/Canola#Comparison_to_other_vegetable_oils its smoke point is actually lower than that of soybean oil, corn oil, or even safflower oil.
- ↑ Okay, well, they actually just use boiling water, but, you know...
- ↑ Beckie, Hugh et al (Autumn 2011) GM Canola: The Canadian Experience Farm Policy Journal, Volume 8 Number 8, Autumn Quarter 2011. Retrieved 30 December 2012
- ↑ Johnson, Stanley R. et al Quantification of the Impacts on US Agriculture of Biotechnology-Derived Crops Planted in 2006 National Center for Food and Agricultural Policy, Washington DC, February 2008. Retrieved 30 December 2012.