When you feel out of place, you have a sense that it's inappropriate for you to be there. A cowboy, for example, would probably feel out of place at a ballroom dance competition.
The common phrase out of place is good for describing someone or something that doesn't quite fit. It might be because it's unseemly and wrong — like wearing a terrifying zombie mask to a kindergartner's Halloween party. It might also be a more subtle sense that it's not suitable — like a modern new house that looks out of place among your neighborhood's old shingled cottages.