There's a few threads on this already - search for "Xenical" on the forum
In summary: it reduces your ability to absorb fat. if you eat fat while taking xenical, you get offensive smelling, floaty (difficult to flush) diarrhoea. this therefore encourages you to either eat less fat, or stop taking the xenical
it's not a particularly effective method of long term weight management, and it's not especially useful unless you have a high fat diet - in which case, the gross side effects put you off fat pretty quickly - but once you skip a few tablets, you start eating fat again, and yeah. Frankly, I don't like it and I'm not sure I would recommend it to any patients.