I'm the same! I'm a quiet person anyway, but become shy in front of larger groups and people I don't know. It's awful if you're out and don't talk as much as the others, people either think you're stuck up or come sit next to you and start going, "Why are you so shy? You shouldn't be shy.. blah blah blah" and try and force you in to a conversation. The worst is when I was sitting with my boyfriend and a group of his friends and one of his mates started asking me why I was shy (err.. I just am?! what else can you answer!) and then proceeded to shout to everyone on the table to vote if they thought I had any reason to be shy! I couldn't wait to get out of there.
Don't force yourself to talk to too many people. In a group, just start chatting to 2 or 3 people and then talk to another lot of people etc, and just chip in little bits if it's a bit group conversation. Try not to feel so self conscious and just be natural and talk to smaller groups naturally to try and help build up your confidence - I'm gradually trying this and it is easier now with bigger groups of people, especially if I don't really know them (ie friends of friends). And remember, if you don't talk, try to sit there and be smiley and be a good listener otherwise people think you're miserable, standoffish and bored and don't want to be there. Good luck.