Homeopathic medicines are usually given in sub-physiological doses. It means, the homeopathy medicine does not contain even a single molecule of crude drug substance in it beyond 12 C potency (1 part of medicine diluted with 1000 parts alcohol).
So if there is nothing chemical left in these medicines, then how and why do they work? Big questions. And Frankly speaking, I do not have any specific answers to them either. This is an unsolved puzzle. We have just started putting the pieces of this puzzle together. There have been many double blind clinical trials which have undoubtedly shown that homeopathy medicines have definite medical properties. Some newer concepts in modern physics like 'memory of water', nuclear magnetic resonance, kirlian photography etc. are also being used to find the physical basis of homeopathy medicines. The initial results are very encouraging and I expect a full answer to this puzzle within the next few years. (Read my blog post "Mystery Regarding Homeopathy Medicines Unveiled"
The current hypothesis regarding the action of homeopathy medicines is as follows:
Diseases as characterized by various names (diabetes, hypertension, cancer, peptic ulcer, OCD etc.) are not definite entities. They are 'states' - states of deviation from health. Diseases as we know them, are just the final stage of a long process. Homeopathy has a holistic approach that is, it recognizes all diseases as a process and not as an entity. Homeopathy medicines when given to a healthy human being, create an artificial disease like state which is called proving. When given to a sick person having a similar 'disease state', the medicine (somehow) stimulates the body's defense mechanism (possibly through neuro-endocrine axis) in such a specific manner that the body itself compensates the diseases state and the process of healing starts.
The way clinically health is restored through homeopathy medicines has been documented extensively and millions of times. What transpires within the body is of academic interest. What is of primary interest to people who are sick and the people who want to heal, is that homeopathy medicines can restore a persons health. This is the bottom line, which no one can deny!