Let's say statistically there's a 50% chance that team A will win, and the betting odds were at 2 to 1, if 80% of the people were all betting on team A, the bookie is going to lose his shirt if team A wins.

njnna is right - the bookie doesn't lose his shirt under any circumstances. When you bet on sports you're not really betting against the bookie; you're betting against the other bettors. The bookie is making money because the winners are getting paid less than they would if the bets were mathematically fair. Let's say you had a friendly bet with a buddy over a game. Between you you've decided one team is twice as likely to win. So you bet two dollars, your buddy bets one dollar, and the winner takes all three dollars. Assuming you've judged the odds of the sports outcome properly, this is a mathematically fair bet - if you made it a million times you wouldn't win or lose money (compared to the amount you've bet, anyway).

Now change the scenario and say a third party is acting as a bookie. The bookie offers you 3:8 odds (instead of 1:2) and he offers your buddy 7:4 odds (instead of 2:1). You still bet two dollars, and your buddy still bets one dollar. This time, though, the winner gets $2.75, and the bookie pockets a quarter. Notice he pockets the quarter no matter which team wins. *This* bet isn't fair, mathematically speaking. If you and your buddy make it a million times you'll both be broke and the bookie will have all your money. This is why you can find bookies everywhere you go, regardless of legality :)