What is the best way to tell my niece that she needs to lose weight?

Delicately: As a bariatric surgeon i can tell you this is a tough subject. My advise is invite your niece to go for walks with you. Mention how great it feels afterwards. While walking tell her about all the excellent benefits of mild weight loss. This way she will not feel threatened and may actual appreciate your care for her. Obviously be careful not to allow hypocrisy, don't eat fatty foods in front of he.