I've read in so many places that your goal should be fat loss first, then build muscle. That said, you can build **some** muscle while losing fat, just don't make the muscle building a priority over the fat loss. After all, you can have a 6 pack but if it's covered with fat, you won't see it. Since to lose fat you may be doing things that could compromise some of your muscle, it makes sense that you can't accomplish both at the same time. I guess when you are losing fat, you want to strengthen AND maintain the muscle you have.

Also...most bodybuilders, and that included Bill Phillips in Body for Life...they will tell you that fat loss is 80 to 85% diet.