Someone who's self-effacing is shy and likes to stay out of the spotlight, shunning attention and praise.
To efface something is to erase it, so to be self-effacing is to try to remove yourself from various situations, especially ones that draw attention. If someone says you did a great job and you say, "It was nothing," that's self-effacing. It is usually considered a positive quality, since it's the opposite of being cocky, egotistical, and attention-hogging. The root of effacing is the Old French word esfacier, which means "to wipe out or destroy," literally "to remove the face."