Prevention of obesity requires policies that work. In this Series paper, we propose a new way to understand how food policies could be made to work more effectively for obesity prevention. Our approach draws on evidence from a range of disciplines (psychology, economics, and public health nutrition) to develop a theory of change to understand how food policies work. We focus on one of the key determinants of obesity: diet. The evidence we review suggests that the interaction between human food preferences and the environment in which those preferences are learned, expressed, and reassessed has a central role. We identify four mechanisms through which food policies can affect diet: providing an enabling environment for learning of healthy preferences, overcoming barriers to the expression of healthy preferences, encouraging people to reassess existing unhealthy preferences at the point-of-purchase, and stimulating a food-systems response. We explore how actions in three specific policy areas (school settings, economic instruments, and nutrition labelling) work through these mechanisms, and draw implications for more effective policy design. We find that effective food-policy actions are those that lead to positive changes to food, social, and information environments and the systems that underpin them. Effective food-policy actions are tailored to the preference, behavioural, socioeconomic, and demographic characteristics of the people they seek to support, are designed to work through the mechanisms through which they have greatest effect, and are implemented as part of a combination of mutually reinforcing actions. Moving forward, priorities should include comprehensive policy actions that create an enabling environment for infants and children to learn healthy food preferences and targeted actions that enable disadvantaged populations to overcome barriers to meeting healthy preferences. Policy assessments should be carefully designed on the basis of a theory of change, using indicators of progress along the various pathways towards the long-term goal of reducing obesity rates.