Our body is an adaptation machine, it can practically be trained to utilize available fuel for its various functions, although the body prefer fuel supply by carbohydrates as it is easily convertible and ready to use.
When we eat, our body respond according to the nutrient contained in our diet i.e carbohydrates, fat or protein.
Carbohydrates is broken down and used up immediately, the rest is stored as glycogen for future use. The body has limited capacity for glycogen storage, hence when the storage capacity is full and there are still left over, these are converted to fat (lipogenesis) and stored away. The body has unlimited capacity for fat storage.
Protein is broken down into amino acid and used for repair and growth.
While dietary fat is absorbed directly and stored as fat
Summary: Fat can be generated from dietary carbohydrates by the process known as lipogenesis if our dietary carbohydrates are in excess of our body need and storage, and fat is also stored directly from dietary fat
WHEN WE FAST:
So when we fast, the body is depleted of supply of nutrients, hence the body call on the reserves, starting with the stored glucose, remember there is only a limited capacity to store glucose, hence this is used up very quickly. Up next is the stored fat.
The stored fat is an incredible source of energy, for most people the body is used to utilising energy provided by glucose, however fasting forces the body to convert fat for energy requirement of the body.
So what happens when you work out in a fasting state?
The combination of low insulin in fasting state (there is no need for the body to pump insulin to the bloodstream in fasting state) and the adrenalin generated during workout stimulates adipose tissue break down (lipolysis) and peripheral fat oxidation (converting fat to energy).
A 2005 study by De Bock et al, concluded that exercise in the fasted state facilitates fibre type-specific intramyocellular lipid (fat within muscles) breakdown and stimulates glycogen resynthesis in humans. This study compared the effect of exercise in the fasted state and exercise with a high rate of carbohydrate intake on intramyocellular triglyceride (IMTG) and glycogen content of human muscle.
Hence the body is far more efficient at converting fat for energy use and at the same time burning intramyocellular fat thereby creating a lean muscle mass when you work out while fasting.
This is also true for low carbohydrates high fat diet and ketogenic diet, the ultimate aim is to reprogrammed your system to rely on fat for energy use rather than carbohydrates, hence instead of storing fat, your body use it for energy.
Some additional advantages of fasting according to Rachel Link
Promotes Blood Sugar Control by Reducing Insulin Resistance
Promotes Better Health by Fighting Inflammation
May Enhance Heart Health by Improving Blood Pressure, Triglycerides and Cholesterol Levels
May Boost Brain Function and Prevent Neurodegenerative Disorders
Aids Weight Loss by Limiting Calorie Intake and Boosting Metabolism
increases Growth Hormone Secretion, Which Is Vital for Growth, Metabolism, Weight Loss and Muscle Strength
Could Delay Aging and Extend Longevity
May Aid in Cancer Prevention and Increase the Effectiveness of Chemotherapy
NOTE: Switching diet from carbohydrate base to intermittent fasting or LCHF or Ketogenic diet may take some adapting at the initial state as the body adjust from easily accessible energy supplied by glucose to that of fat, however, after the initial stage the body adapts and energy level returns.