Ketosis helps you burn fat
The pancreas is a gland organ that produces insulin and glucagon. Insulin is a hormone that directs the body to store glucose as fat, whereas glucagon directs the body to break down fat (triglycerides) into fatty acids and ketone bodies that can be used by the body for energy. These two hormones help to keep glucose at a normal level in the body.
After a meal, the pancreas reacts to an increase of glucose in the blood by secreting insulin. When the body is not active enough to burn the available glucose and it cannot produce enough insulin to convert it to fat, blood sugar increases above normal levels. Persistent, elevated blood glucose is diagnosed as diabetes.
During periods when much of the available glucose has been consumed and the blood glucose level decreases, the pancreas releases glucagon causing the liver to convert fat into fatty acids and ketone bodies that can be used by the body for energy. This metabolic process is called ketosis. Carbohydrate shortages cause the liver to increase the production of ketone bodies from fatty acid oxidation, and allow the heart and skeletal muscles to use ketone bodies for energy, thereby preserving the limited glucose for use by the brain. Ketosis starts when carbohydrates are depleted and you feel hungry. At this time, your body starts to burn fat.
Diets, like the Atkins diet, work by limiting carbohydrates. This forces the body to burn fat for energy. You will lose weight when the number of calories in the diet is reduced below those needed to maintain your current weight.
 Medical Biochemistry Page - Fatty Acid Oxidation
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