How does the body lose weight (from a physiological standpoint)?
Setting the stage for this answer is simple. Eat fewer calories than you expend and viola, weight loss. Imagine the body’s energy stores as a checking account with a positive balance. On a daily basis, you make deposits (eating) and withdrawals (activities of metabolism). If you continuously spend more money than you deposit, what happens? Your bank balance begins to diminish. At the end of one day, it may not be a big deal, say a few dollars. But over time, your dwindling account balance becomes quite noticeable indeed. This is obviously an oversimplification, as the body is capable of adaptations, but the premise is still sound.
So, physiologically speaking, weight loss occurs when the activities of catabolism outnumber those of anabolism and there is a net energy deficit. More energy comes out of storage than goes in over the course of time.
Now for the more detailed explanation. The remainder will look at what occurs during and immediately following a meal (the fed state) and for the hours after that, until food is eaten again (the post-absorptive state).
The Fed State
In response to eating and the presence of amino acids and glucose, the pancreas secretes insulin. Insulin essentially tells the body to store stuff and use glucose for energy, finding homes for the nutrients entering the body. The liver gets first shot at everything. Amino acid pools and glycogen stores are filled before sending stuff into general circulation. As blood sugar levels increase, so does insulin secretion. Insulin facilitates entry of amino acids and glucose into muscle cells, to be used for protein and glycogen synthesis, and fatty acids into fat cells. Glucose availability beyond that needed to fill glycogen and immediate energy needs is used to create triglycerides for storage in the liver and fat cells. Amino acids not incorporated into tissues and structures or used for immediate energy can also provide material for the formation of triglycerides and fat storage.
The Post-absorptive State
There are endocrine system adjustments after a meal that occur acutely, within minutes, and chronically, measured in hours and days (as in fasting and starvation).
As blood glucose availability declines, so does insulin. This waning glucose availability causes an increase in glucagon (essentially the opposite of insulin) and the release of the catecholamines epinephrine and norepinephrine. These hormones are responsible for changing the direction of flow, ensuring a constant availability of fuel in the blood stream. The liver is the first to respond. Liver glycogen is broken down (called glycogenolysis), releasing glucose for use by the central nervous system, red blood cells (RBC) and muscle. In time, and depending upon demand, muscle glycogen liberates glucose for use within that muscle. Muscle glycogen is unable to export glucose to other muscles or tissues, due to a lack of the enzyme glucose-6-phosphatase. Fortunately, the liver has this enzyme, making it the one in charge of maintaining blood glucose levels.
As time post-absorption increases, the limited liver glycogen stores (60-65 grams) run out and gluconeogenisis becomes necessary. This is literally the creation of new glucose from non-glucose sources. In the liver, glycerol from the breakdown of triglycerides is combined with lactate and alanine from muscle to make glucose. Diminished insulin levels and the actions of glucagon and epinephrine decrease glucose use and inhibit its uptake into muscle. This kicks up lipolysis, liberating free fatty acids from fat stores for energy production via beta-oxidation. In beta-oxidation fatty acids (chains of carbons) are broken down two carbon segments at a time, providing acetyl CoA for use in energy production (in liver and muscle mitochondria). Fat now becomes the primary fuel source for muscle.
By now, it has been several hours since your last meal and you are feeling the effects of hunger. You eat and the cycle begins anew. At the end of the day, a caloric deficit will have been met by fat stores, leaving your adipocytes a bit lighter and less packed. If this caloric deficit is maintained (through fewer calories eaten and more calories burned), fat stores will continue to shrink.
For the goal of weight loss, it appears that it pays to save a little and spend a lot.