WPF datagrid with MVVM

I'm trying to bind a datagrid in WPF to my ViewModel so that it will update any cell changes to the database as well as allow the user to delete rows and add new rows. I've got part of it working but can't find a ELEGANT solution for the ADD and modify. here is the xaml

<DataGrid AutoGenerateColumns="false" HorizontalAlignment="Left" Margin="26,41,0,0" Name="dataGrid1"   
              ItemsSource="{Binding Path=GetAllItems}" Height="200" VerticalAlignment="Top" Width="266" >
        <DataGrid.Columns>
            <DataGridTextColumn Binding="{Binding Path=ItemListID}" Header="ID" Visibility="Hidden"/>
            <DataGridTextColumn Binding="{Binding Path=ItemName}" Header="Name" Width="4*" />
            <DataGridCheckBoxColumn Binding="{Binding Path=IsActive}" Header="Active" Width="*"  />
        </DataGrid.Columns>

then in my view model method

private ObservableCollection< ItemsList> getAllItems()
{
    using (var context = new InspectorGeneralEntities())
    {
        var query = from I in context.ItemsLists
                    select I;

        var item = new ObservableCollection<ItemsList>(query.ToList());
        return item;
    }
}

Deleting a row or modifying a row on the datagrid does not flow onto the database.

a) what other binding do i need to create in the xaml code that will detect these events

b) How do i detect a removed record or modified item in the view model so that I can update the datacontext if it won't automatically.