The main constituents of ephedra, notably ephedrine and pseudoephedrine, are plant alkaloids that are thought to be responsible for the ephedra's medicinal action. These alkaloids are believed to cross the barrier protecting the brain from unwanted chemicals in the blood and mimic activity of the sympathetic nervous system ("fight or flight") by interacting with various neurotransmitter receptors. Specifically, it is thought to enhance the release of the neurotransmitter norepinephrine and stimulates alpha- and beta-adrenergic receptors. The problem with this non-specific stimulation of adrenergic receptors is that while the desired receptors (beta-2) in the lungs are stimulated to open the airways, other types of receptors are also stimulated, including the beta-1 receptors in the heart that increase heart rate and force of contraction, and the alpha-1 receptors that increase blood pressure and decrease circulation to the renal system and other parts of the body.
Epinephrine, which is similar to ephedrine but much more active and short-acting, is a conventional treatment for asthma, but it has been largely replaced by current asthma medications which are able to act more selectively on beta-2 receptors.
Possible Side Effects of Ephedra
irritation of the stomach; diarrhoea
irregular or rapid heart rhythms; heart damage
high blood pressure
restlessness; nervousness; sleeping problems
Use of ephedra has also been associated with stroke, seizures, psychosis and death.
The risk of side effects and adverse effects appears to be greater in people with preexisting conditions, such as heart disease, high blood pressure; heart rate disorders; thyroid disease; hypoglycemia; glaucoma; anxiety; glaucoma; pheochromocytoma; diabetes; kidney disease or kidney stones; mental illness or a history of mental illness; enlarged prostate; cerebral insufficiency and a history of seizures, stroke, or transient ischemic attacks. People with these health conditions should avoid ephedra. People with allergies to ephedra, ephedrine, or pseudoephedrine should also avoid ephedra.
Ephedra is believed to increase the risk of heat stroke, because it increases metabolism and impairs the body's ability to lose heat.
Source - http://altmedicine.about.com/cs/allergiesasthma/a/Ephedra.htm