Meaning:
Literally this sentence means “Come on, let’s hurt each other.” This saying, which associates a romantic relationship with hurting each other, originated from Japanese manga “Guilty Crown.” As not all relationships end well, many people may end up being deeply hurt when a breakup becomes inevitable. Therefore, it’s a joking way of saying “Come on, let’s fall in love.” Besides being used flirtatiously, this sentence is also used among buddies when someone actually means to say “Bite me.”
Example:
A: 你有男朋友吗？
Nǐ yǒu nánpéngyou ma？
Do you have a boyfriend?
B: 没有。
Méiyǒu。
No.
A: 你知不知道我从大一开始就暗恋你了？
Nǐ zhībuzhīdào wǒ cóng dàyī kāishǐ jiù ànliàn nǐ le？
Do you have any idea that I’ve had a crush on you since our freshman year?
B: 真的吗？来啊，互相伤害吧。
Zhēn de ma？Lái a，hùxiàng shānghài ba。
Really? Come on, let’s fall in love.