Most modern medical research leans toward the theory that the primary instigator of hair loss is a hormone called Dihydrotestosterone (DHT) which is converted from testosterone and binds to sites on hair follicles. DHT is a hormone formed when the enzyme 5 alpha-reductase interacts with testosterone.  DHT is believed to destroy hair follicles in people with hereditary hair loss.

Hair follicles go through three phases of hair production, Anagen, Catagen and Telogen, and DHT appears to make the follicles go into their resting phase faster, which causes the hairs produced by those follicles to become thinner and thinner with each successive growth cycle.

Hair loss is also linked to genetics and hormonal influences.  Each hair follicle appears to have a predetermined number of sites to which DHT can attach.