Butter vs. margarine can be a tricky choice. Both have saturated fats and should be used sparingly.
Margarine is made from vegetable oils, so it contains unsaturated "good" fats — polyunsaturated and monounsaturated fats. These types of fats help reduce "bad" cholesterol (LDL). If you're using margarine, choose soft tub margarine rather than the stick variety. Tub varieties are lower in trans fats. Read the nutrition label, and look for one low in saturated fats and with no trans fat.
Butter, on the other hand, is made from animal fat so it contains more saturated fat.