Self-deprecating humour...

What is your opinion on self-deprecating humour, ie people who make jokes about themselves, sometimes shamelessly but always hilariously?

I always thought that this type of person would have a very laid back view of the world, never taking anything too seriously, and always looking at the brighter side of life. This person would also be able to make light of embarassing situations that they find themselves in.

But what if the reason you always make fun of yourself is because you feel so uncomfortable in your own skin that you need to put yourself down somehow? Doesn't an extreme level of self-deprecating humour become self-insulting instead? Where do you draw the line?