Several workers have proven that succussed ultra high dilution of a drug molecule in water or alcoholic medium, even exceeding Avogadro number, can bring forth noticeable physiological changes of an organism. Homeopathic drugs are prepared by dissolving such drug ingredients in distilled water and then the solution is centesimally diluted serially by ethanol. A mathematical model has been proposed by the present worker, which explains why the drug does not become non-molecular even in ultra-high dilution. This is due to loss of homogeneity in the solution, caused by increase of dielectric constant of the medium during the process of potentization. Facilitated binding of the drug molecules with minute physiologically important protein factors may be the cause of visible physiological alterations.