This article is from the Aerobics Fitness FAQ, by email@example.com (Robles) with numerous contributions by others.
No. When we're working a muscle or group of muscles to
burn fat, we have no control over what part of the body we
burn fat from. There is no such thing as "spot reducing".
Fat generally is used up in pretty much the reverse order
it was put on, (LIFO - Last In First Out). When you are
exercising, the blood is carrying fat from all over the body
to provide the energy. The muscles which are being worked
will improve, of course, so when the layers of fat finally
do get worked off, you'll have some nice lean tissue to show
for all your efforts.
(from Michael G. Kurilla <firstname.lastname@example.org>)
Another aspect to this question is the fact that muscle
growth underneath a fat deposit can give the appearance of
spot reduction. This is because the overlying fat is stretched
over a greater surface and appears thinner, although the total
amount of fat is the same. A good analogy is with a balloon.
As the air is increased, the skin on the balloon gets thinner,
but the amount of balloon material stays the same. I think that
this may be how the spot reduction myth originated. By working
the muscles below the fat, people think they are actually making
the fat go away.