Does your stomach really shrink during dieting?

Is it true that the stomach actually shrinks during dieting because of less food intake? If so,does the shrinking mean you will feel full with less food intake? Also, how does this affect the 'hunger pangs'? I have already lost 15 kilo's since january with 10 more to go. I am losing weight SLOWLY due mostly to a change in eating habits, not crash dieting.