Basically, how the muscle gets added is through a diet adequate in protein. When you reduce the carbs and increase the protein, your body gloms on to that protein like it's been absolutely starving for it (which if you've been LF like you say, it most likely is starving for it) and at the same time, your body will burn the fat.

Here's a story about my youngest daughter who is on Atkins and what happened with her. She started out weighing at about 205 pounds. I wish I'd have taken her measurements at the start but I didn't. She lost about 5 pounds on Induction, then her weight loss just stopped. I measured her shortly after the Induction period and used The Zone's body fat calculator. At that time her lean body mass was less than 100 pounds. Basically we're talking marshmallow girl here with about 50% fat to 50% LBM.

The halt in weight loss after Induction is very typical, during which times the body tends to re-adjust itself so we weren't real worried. A couple of weeks later she still hadn't started losing anymore weight, and a week after that she hadn't either. Oddly enough, I was noticing a huge difference in her body shape and the way her clothes were fitting. I pulled out the tape measure and compared the results with the previous measurements, then used The Zone's body fat calculator again. She had not lost one single pound on the scale, but had gained somewhere in the neighborhood of 3-4 pounds of lean body mass. Basically, she was burning the fat and had replaced it with muscle simply from eating adequate protein. This is a girl who absolutely hates exercise, and all she added to her daily routine was a half-mile walk to the mailbox and back.

I don't remember just how long she went through this no weight loss time, but I could absolutely see the inches falling off of her during the entire time. Ultimately she gained about 8 pounds of lean body mass. Now she is seeing the scales move again, but her measurements is what kept her encouraged during that no loss time.

One thing to keep in mind is that fat has about four times the volume of muscle. So imagine looking at one pound of fat (like 4 cubes of butter) vs. looking at one pound of solid muscle (about the size of 1 cube of butter in comparison)--the volume is going to be significantly different.

This is how your body will lean down and you can weigh the same as you do now.