A handjob received while dining
"Oh man, that chick was so wasted at the BBQ that she didn't even bother to wash the tobasco sauce off her hand before shoving it down my pants for a rough case of handfire."
The process of self satisfaction via masterbating (hand), and the eventual release of seminal fluid (fire) as a result of the act. Note that if "the fire" is not made, the term handfire is not applicable. You would be attemting to make some handfire, but would have not completed the act in the true sense of the term.
"I sprayed her down with a little handfire"
Dude #1: "Yo man, you get with that hot chick from last night?"
Dude #2: "Yeah, she gave me handfire under the table at the bar but I got too drunk to take her home."