How does weightlessness occur in a space shuttle that is orbiting earth?

Weightlessness is a measure of how much resistance there is between an object and the local gravity. If you are standing on the ground, then there is 100% resistance between you and the pull of gravity. Your weight is equal to the pull of gravity on your mass. When you jump off a tall object, you are falling. You feel weightless because there is no resistance between you and the pull of gravity.

When you are in a shuttle orbiting the Earth, both you and the Shuttle are falling in such a way that you never hit the ground. This is called an orbit. You feel weightless because you are falling. You just never hit the bottom like you would on Earth.