Any situation which results, ultimately, in failure. This can include physical abuse, embarrassing situations, or just all around epic fail.
person 1: "broseph man, did you see #40 try and blitz up the middle? He's so teensy."
person 2: "Dude..., fuck city."
person1: "so yesterday me and my girlfriend were fucking on her mom's bed, and right as im blowing an 8-roper all over her face, her mom walks in..."
Person1: "dude it was total fuck city"