If caffeine has become a part of your daily diet, you are definately not alone. Even if you don't like coffee, this most popular drug can reach your system from tea, some soft drinks, and (to a lesser degree) chocolate, herbal supplements, medications, energy drinks. You can even buy  caffeinated water now! Research has shown that caffeine increases alertness, decreases fatigue, and improves muscle coordination in most healthy people and small amounts of caffeine are considered to be safe. However,  larger doses can rack havoc on your body. With a thorough knowledge about its effects on our systems, most of us are able to make an educated decision before making a choice between a cup of coffee or herbal tea. But if having to choose the right beverage for you makes you anxious and you don't know why, then you've got to know about the life of caffeine inside your body. Caffeine has the potential to raise stress hormone levels in the blood, inhibits important enzyme systems having to do with house cleaning in the body, sensitizes nerve reception sites, and is associated with a sense of poor health, anxiety, and depression. Some link peptic ulcers and several other kinds of digestive problems arise from the use of coffee.

What Caffeine Does To Your Body

The Brain

The reason caffeine can wake you up almost in an instant can be found on the drug's effect on the brain. Caffeine blocks a brain chemical called adenosine making you feel tired and drowsy by slowing down nerve cell activity. Your brain cells are constanly working  - processing information, ensuring all the functions of the body are running smoothly. Sooner or later, your brain cells need a break, so they start pumping more adenosine.  This also causes blood vessels to dilate letting in more oxygen to all the tissues in the body.

To a nerve cell, caffeine looks like adenosine and it binds the drug to adenosine receptor.After that, there is no place to go for the natural brain chemical, so its action is stopped. The trouble is that caffeine doesn't cause drowsiness like adenosine and instead of slowing down your brain cells speed up. This, in turn, fires up your brain activity making you feel alert. Then there is a chain reaction of caffeine's effects which are completely oposite to the effects of adenosine. Namely, increased activity of neurons signals brain's the pituitary gland that something is happening very fast, there is an emergency and the body must prepare accourdingly by releasing stress hormones. and because adenosine receptors are taken up by caffeine,there is no chemical to open up the the blood vessels. Instead,  blood vessels constrict and the heart has to work twice as fast to deliver necessary oxygen and nutrients to all tissues in the body.

Many people mistakenly believe that coffee helps them get through a difficult day. But the effect is only temporary, always followed by fatigue. So, most reach for another quick fix of sugar or caffeine sending themselves on a roller-coaster ride of brain hyperactive waves. In addition to fatigue, mental confusion and depression also result from the use of caffeinated drinks. 

The research has shown that stimulants, such as caffeine, may help in learning new information and keeping it in short term memory. But the retention of learned material is questionable, and may even be worse than if it was captured without any artificial stimulation. If caffeine is taken at night, it interferes with the mechanism the brain has of transferring freshly learned material from the short-term memory to the long-term memory.

Addiction

Caffeine increases  levels of dopamine, another brain chemical that makes you feel good. It is the same stimulus trigered by amphetamines (heroine and cocaine also manipulate dopamine levels by slowing down the rate of dopamine re-uptake). Even though the impact of caffeine is much lower than heroin's, it can be the reason for caffeine addition. If something brings you the feelings of pleasure, you are likely to strive for that activity or substance. As long as the dopamine continues its action, you try to maintain that pleasurable state. The problem is that with time you may need to increase the dose as your body habituates to that good feeling and diminishes its ability to recognise the 'kick'. Same principle works for caffeine and it is suspected that the dopamine connection contributes to caffeine addiction.

Digestion and Detoxification

Now most of the blood doesn't get to your core but rather to the extremeties. This is the body's way of preserving energy to stay alert and prepare the muscles of legs and arms to run. Blood flow to the stomach slows inhibiting important enzyme systems that help with all the household work of the detoxification. Liver is signaled to release sugar into the blood for extra energy. Under normal conditions, liver's job is to filter all the poisons that reach the body, and now it is too busy keeping the blood sugar levels high.

Many people find that caffeine drinks cause them to suffer diarrhea followed by constipation. This comes from stimulus of your digestive system speeding up digestion and waste excretion induced by caffeine.  Headaches are common among caffeine users, and often clear up after only a short period of caffeine abstinence — a week or two as a withdrawal symptom. Sensitivity to caffeine is also quite common and some experience headaches soon after drinking a caffeinated beverage.

Reproductive System

Damage to chromosomes by caffeine has been recognized for years. This is another reason medical professionals recommend minimizing caffeine use during or after pregnancy, since caffeine can damage the chromosomes of the ova and spermatozoa, as well as the chromosomes of the developing embryo during pregnancy. Any substance that can damage chromosomes can also cause an increase in the rate of cancer. Bladder cancer in women is 2 1/2 times more likely to occur if a woman drinks only one cup of coffee per day. There are already several cancers that are known to be more common if one uses caffeine.

References:

Greden, John F. M.D. et al. Anxiety and Depression Associated with Caffeinism Among Psychiatric Inpatients. American Journal of Psychiatry 133:8, Aug 1978.
Bellet, Samuel. Effects of Coffee Ingestion on Catecholamine Release.
Greden, John F. M.D. Anxiety of Caffeinism: A diagnostic dilemma. American Journal of Psychiatry 131:10, October, 1974.
Miscarriage and the Coffee Connection. Science News October 25, 1975 page 267.
The Medical Effects of Coffee. Medical World News January 26, 1976 page 63-73.