When the person you like doesn't like you back, but it's worse. This person treats you as a friend, so even though you every time you hang out with this person, you want to make out with them and stick your tongue down their throat, you have to resist because you might lose them as a friend.
This phrase came from the show Friends. Joey told Ross that Rachel likes him, but will never like like him. That he is in this 'friend zone.'
"Dude, I just spent hours texting her trying to make her feel better ever since Pete broke up with her and you know what she told me? 'Why can't I find a guy like you?'"
"Sorry, man. You're totally FRIENDZONED!