Can you lose fat and shape your body ( build muscle ) at the same time ? and will it work ?

My understanding (not really but I do believe it) is that you can't build muscle in a deficit.

However, I find that when I begin running and lifting after laying off for a while - or when I work a new lift or significantly increase my weightlifting, I most definitely notice changes in my body - muscles harder, more pronounced - best example is my quads and calves from running, which only takes a couple weeks to get solid (LOVE that!). I say this because it is discouraging to hear (or think you hear) that your body won't harden and change until you go into a bulk (which if you're trying to lose weight could seem like an eternity). While I've been in a deficit for months now, I'm lifting a lot, and there's no question that my arms, shoulders, back and chest have changed in appearance. So - while I am not contradicting what must be the truth, I will just say that there are definite changes to be seen while you're in a deficit that are more encouraging than just less flab.

I would love to be able to understand why I see these changes I see despite being in a deficit - sincerely curious. I have a hard time believing this was all under the fat and I just had to lose the fat. I'm only about 10-15 pounds over my ideal weight. Thx!

SUNNYBEACH has said it!
If this is your first year of putting on muscle size, than you have some advantage for muscle gain during fat loss. However, yes it will be slow.
If your looking to get some serious muscle mass than I don't recommend trying it. If you just wanna be lean and meen than go for it

Yes. Commonly called recomp.

The speed you can do it depends on many factors plus your current condition and ultimate goal.