The fileystem handler creates a kind of dicationary writing to sectors on the disc, so when you update the content of the file, the filesystem looks up the dictionary on the disc, which tells it, in which sector on the disc the file data is located. Then it spins (or waits until the disc arrives there) and updates the appropriate sectors on the disc.
That's the short version.
So in case, of updating the file, the file is normally not moved to a new place. When you write new data to the file, appending to it, and the data doesn't fit into the existing sector, then additional sectors are allocated and the data is written there.
If you delete a file, then usually the sectors are marked as free and are reused. So only if you open a new file and rewrite it, it can happen that the file is put in different sectors than before.
But the details can vary, depending on the hardware. AFAIK if you overwrite data on a CD, then the data is newly written (as long as the session is not finalized), because you can not update data on a CD, once it is written.