Here's an article I read when I was concerned about the same thing.
The Atkin's 2 Week induction phase:- heady stuff, weight loss nearly every day, usually enormous and unbelievable amounts!
This is very often followed by complaints of "a stall" or only losses of "just 1lb per week".
Many people don't know that weight loss is rate limited, in other words the body has factors preventing more than a certain amount to be released from storage and even more factors that prevent these released fatty acids from being used up instead of stored back in the cells.
This is called the set point principle.
The priority of the human body is survival, anything that threatens that results in a cascade of events to maintain the previous status quo.
Water fluctuations are one way the body protects itself.z During induction you may have lost 10lbs during 2 weeks, possibly 7lbs 1st week and 3lbs 2nd, then weeks 3& 4 - no loss! & weeks 5&6 only 1/2lbs each- so what's happening?
Initially the body jettisons your carb-burning enzymes whilst building fat-buring ones(around 3lbs), and the water attatched to the glycogen stores that we diligently deplete to get into BDK. This amounts to 3-5 lbs water. In addition muscle stores of glycogen are not being replaced when used, which will account for most of the rest of your losses. All in all maybe 0.5lbs fat metabolised during 1st week & maybe same 2nd, so only 1lb fat lost, but 9lbs water and enzymes.
The body senses this diuretic effect, and the sirens go off, 'WARNING! Water loss occuring... New thing! get back to status quo!!"
The Brain tells body to produce vasosupression antidiuretic hormone - more water is retained and so, no weight loss is registered on the scale.
Fat loss is still occurring however- maybe 2lbs per week- because BDK is firmly established and appetite surpresssion is in effect- but water is hiding that weight loss.
The body is preventing dehydration and that is a Good Thing. However, from the perspective of the scale this can be very discouraging, and why we all say "Get the tape measure out!"
Which is why the mantra 'Water retention hides weight loss' is helpful!! Water retention will mask ongoing weight loss for as long as the body retains the water.
We can combat this by drinking more water but we can't overcome this natural mechanism during the initial water loss phase of Atkins.
By week 5&:6 things start to get back into balance and the scale will begin to reflect true weight loss - which is still rate limited.
http://www.low-carb.org.uk/3rdweekstall.htm