The prevailing interpretations of physics are based on deeply entrenched assumptions, rooted in classical mechanics. Logical implications include: the denial of entropy and irreversible change as fundamental physical properties; the inability to explain random quantum measurements or nonlocality without unjustifiable assumptions and untestable metaphysical implications; and the inability to explain or even define the evolution of complexity. The dissipative conceptual model (DCM) is based on empirically justified assumptions. It acknowledges the contextual relationship between a physical system and its positive- temperature ambient background, and it extends HCM descriptions by defining entropy and exergy as objective contextual properties of state. The irreversible production of entropy establishes the thermodynamic arrow of time and a system’s process of dissipation as fundamental. The DCM defines a system’s measurable rate of internal work as an objective measure of stability of dissipative process. A dissipative system can follow either of two different paths leading to higher stability: 1) increase its exergy supply or 2) improve its function utilizing its existing exergy supply. The evolution of life proceeded both by competition for resources and by cooperation to evolve and sustain higher functional complexity.