Ack! This is probably the biggest misconception about eating protein out there, and I understand why it exists.

When you eat high carb, yes, 58% of what you consume of your protein can be turned into glucose. When you eat LC, yes, excess protein can, and will be, turned into glucose - there's nothing we can do to stop this. However, that being said, it will not be stored as fat.

[the following copied from Orion1 at Protein Power BB]

The process of converting excess protein into glucose is called de novo gluconeogenesis and it is a constant process that your body utilizes to maintain glucose homeostasis.

Gluconeogenesis, occurs predominantly in the liver although the kidneys also contribute approximate 10% of all gluconeogentic activity. The main precursors of gluconeogenesis are amino acids derived from the muscles. Another important precursor is lactate, which is formed in red blood cells and in muscles when oxygen is in short supply. Glycerol produced from the degradation of fats can also sustain gluconeogenesis. Humans can synthesize several hundred grams of glucose per day by gluconeogenesis. Cortisol, glucagon, and epinephrine promote gluconeogenesis, whereas insulin inhibits it.

So, it is possible to make glucose out of proteins, in fact we do that all the time. Whenever the blood glucose level drops, signals are sent to put the gluconeogentic machinery to work. However, this process is under the control of glucagon, cortisol or epinephrine, the three of them acting under different circumstances. Glucagon and insulin cannot both be "on" at the same time. That is, if glucagon is “on” and controlling gluconeogenesis, insulin is “off”, and vice versa. Following this reasoning, if insulin is off (actually that means not present in excess), fat storage is also controlled, and fat release from the fat cells is favored (another process influenced by glucagon).

The process of storing fat into you fat cells needs both fat and insulin. The process of making fat requires both excess carbohydrates and insulin to activate fat synthesis. With glucagon being released instead these processes are inhibited. Thus, the mere conversion of amino acids into glucose by gluconeogenesis should not be misunderstood as a mechanism through which fat can be synthesized or deposited into the fat cells. The glucose produced by gluconeogenesis has a “tag” on it, and it will serve to supply for blood glucose when the levels fall.

Nat