The act of spending time enjoyably, yet unproductively, with one's peers.
Fred is over at his cousin's house shooting the shit with family members.
Talking with others just to pass the time. The topic of conversation may vary, but in general there is no point to be made.
We were just hanging out last night at the bar and shooting the shit.
To converse lightly, with no specific topic or objective in mind.
See also: shooting the breeze
So, Bill and I were shooting the breeze and suddenly we came up with an idea for a new website.
To discuss unimportant, random topics in a laid back, comfortable manner. Usually with good friends and dumb topics. (aka shooting the breeze)
We sat around the campfire shooting the shit.
To converse with others about trivial matters.
We sat around all night, drinking and shooting the shit.
The art of talking for a lengthy period of time, yet accomplishing nothing.
We spent all of Saturday afternoon shooting the shit about inchworms.
the sit around and randomly talk about nothing.
i'm shooting the shit with my homies
To chat, to discuss. Usually pointless and often esoteric subject matter. Meaningless banter.
"What were we doing? Aw, y'know, just shooting the shit over some lunch."