This article is from the Japanese FAQ, by TANAKA Tomoyuki tanaka@cs.indiana.edu and Olaf Meeuwissen olaf@IMSL.shinshu-u.ac.jp with numerous contributions by others.
In and of itself "gaijin" can hardly be said to be a derogatory
word. Most people and dictionaries will tell you it is just
short for "gaikokujin", means `foreigner' or `alien' and can be
contrasted with "houjin" (Japanese person). Any negative conno-
tations that come with the word are the results of gross general-
ization, lack of information, (hyper)sensitivity, and the like.
Whether these negative associations are implied, depends on con-
text.
Kids playing in the street exclaiming "Ah, gaijin da!" are gen-
erally just surprised at the sight of a foreigner. Real estate
agents using "Gaijin wa dame!" are pigeon-holing all obvious
foreigners into a group of potentially troublesome customers
they'd rather not have.
[ed.: I think most of the fuss around the word is caused by
overly PC-sensitive types not comfortable with the idea of (sud-
denly) being part of a rather conspicuous minority.]
 
Continue to: