A weight-loss regime has to be something that you can carry out day after day after day and be reasonably happy about it.
Don't get so strict about it that you end up hating the diet and exercise regime, though. Try to work out a plan that suits your temperament and comfort. For example, I dislike exercise so incorporate it into everyday things like walking to the shops rather than driving.
Try to stay focussed, for example, if you feel cravings, write a personal blog entry about them instead. By the time you've finished the cravings may have subsided, or at least the "oh heck, I can't do this - just one little cake won't hurt" frame of mind might have refocused itself on your real goal - which is to NOT eat that cake.
Keep chipping away at it and you'll eventually win.