Hot and cold water runs freely from the faucet to the tub, but when the shower is turned on, the majority of the hot water continues to run from the faucet to tub and not go up through the shower. No problems with cold water. What is wrong and can I fix this?

Where's your diverter located? On the spout or in the shower valve?

I believe in the spout.

i believe in the spout.

Somthing's not right here. If the diverter was in the valve body I could see the hot water being blocked by a clog in the hot side leading to the shower raiser.
However if the diverter's in the spout then BOTH hot and cold are directed to the spout and the opening to the tub's closed off and the HOT AND COLD water's diverted to the shower raiser. There's just no way a spout diverter can separate hot and cold water. Go back and check the diverter and give me the brand name and type,( one handle or two/three knobs).
Back to you. Tom