Welcome to 3FC, Syd!
You lower your body fat percentage by losing pounds of fat while preserving and/or increasing your muscle mass (also known as your lean body mass or LBM).
In order to lose fat, we need to burn off more calories through exercise and activities than we take in every day. The best way to do that is a three-part strategy of restricting calories (the nutrition or diet part), cardio (aerobic exercise) to burn fat, and weight lifting (resistance training, toning, strengthening - there's lots of names

) to maintain and increase lean muscle.
I was able to lower my BF% from 57% (at 257 pounds) to 16% (at 135 pounds) using that three-part plan.
Hope that helps!