Can any doc tell me what's the best way to lose body fat but gain muscle?

Aerobic/Cardio: Aerobic exercise or Cardio exercise that is sustained for > 1 hour tells your body to switch from carbohydrate (sugar) metabolism to Fat metabolism so you actually will burn fat. This can be through running, cycling, hiking, or other gym Cardio devices elliptical, etc.

Reduce weight: This is a repeat of what I have said before. My philosophy is that the best way to lose weight is not by dieting, but by changing your lifestyle to a healthier one. You don't need a drastic diet. Make small changes. Eat the right portions, eat 3-5 small meals a day, cut back on carbs and sugars, increase lean protein/veggie/fruit/water intake, and lift weights to build muscle.