The concept of `丢脸` is inseparable from the cultural cornerstone of `面子 (miànzi)`, or “face”. In Chinese culture, `面子` is a kind of social currency. It's a blend of one's prestige, reputation, influence, and the respect one commands from others. You can gain it, give it to others, and, most importantly, you can lose it. `丢脸` is the action that causes this loss. The crucial difference between `丢脸` and Western “embarrassment” is its public and collective nature.
Furthermore, because of China's more collectivist culture, an individual's actions reflect on their entire group. A child who misbehaves in public can cause their parents to `丢脸`. An employee who makes a huge error can cause their company to `丢脸`. This ripple effect makes the act of `丢脸` a much more serious social transgression than simple personal awkwardness.
`丢脸` is a common, powerful term used in everyday life. It's almost always used in a negative and serious (though sometimes hyperbolic) manner.
A frequent mistake for learners is to overuse `丢脸` for minor situations where a lighter term would be more appropriate.