I read somewhere that when you overdo weight lifting and you get really sore its because your muscles are damaged. It also said that to repair the muscles the body releases some sort of hormone which also helps with weight loss. So is it true that overdoing it in the gym can help you lose weight? what could be some of the negative affects of constantly overdoing it (other than soreness)?

well "overdoing it" and being sore are two different things. if yhour sore after a workyou then that fine. the typical rule of thumb is that you should not work out the same muscle group two days in a row. if you do you run a great risk of tearing and/or pulling muscles. when i work out im sore but im not overdoing it. and yes when you work out you will burn fat because you body naturally uses its one fat for energy. one thinkg i can reccomend is before, about an hour b4, eat alot of carbs, drinks plenty of liquids during, and after eat protien with little carbs and also you can take creatine. sometimes i will put creatine in my drink when i work out and that helps. but if your sore thats ok just the main thing is is not to work out the same muscle group two days in a row. like monday do shoulders, back, and bisepts, tuesdays do chest and tricepts, and weds to legs. this is just and example. good luck and you also need to know the limits of your own body. that is very important

Soreness does not really mean you are overdoing anything and that your muscles are really damaged. What happens when you work out is your muscle tissue is stretched beyond it's normal stretching capacity. When that happens weaker cell tissue tears off. This is the damage they must be referring to. But what happens after the weaker muscle is torn off is the benefit of working out. Stronger longer newer muscle tissue replaces the older tissue. It takes a few days to regenerate, if you are in good shape. During this period the remaining muscle tissue is taking on a little more than normal until cells can be re-generated, until that happens you are going to be a little sore. That is why people say to never work the same muscle group every day. Do upper body one day then focus on the lower body the next day etc.... It gives the body time to wash the older tissue out of your body and grow the newer stronger tissue.
Overworking your body can produce many problems. You can actually rip a muscle or a tendon. You can also destroy joints from overexertion. Hernias, nerve and spinal damage can occur. If done incorrectly working out can be very dangerous and not beneficial to your health. Even if you think you look great. If you are working out and are new at it or have been working out and want to step it up. Find someone that isn't a fanatic and knows what they are doing and learn from them. Try cardio exercises to loose/regulate weight/fat. Use lifting to shape, form muscles and increase overall strength.
Don't try to loose weight by over lifting. Walking fast or running at a slow jog will burn calories faster than lifting. Swimming is awesome for burning calories and is very good for your muscles, joints, heart...well everything!! Swimming is just good!
If you do it wrong you could damage yourself for the rest of your life.

What you're asking about is a condition called "overtraining". This is caused by lifting weights too often and not allowing your body enough time to recover between workouts, and you start seeing actual strength loss, regression, fatigue, lethargy and a lack of desire to work out.
The substance you may be thinking of is cortisol, which in itself is catabolic. It's produced when th body goes through stress and works against the absorption of nutrients, among other things.
As you mentioned, when you lift weights, tiny tears occur in the muscle fibers at a microscopic level that take some time to heal, usually around 3 days or more. If you don't give that muscle group enough time to heal, your body doesn't ever have a chance to recover and that's when you hit overtraining.

You could pull your muscle and then add to your recovery time. never heard of the weight loss thing.