As posted on Death + Taxes (great site):

1. “Man, what?”
Act dumb. Maybe shrug in a vaguely irritated manner. The “Man, what?” response, Reatard claimed, both signifies confusion and a vague air of pacifism that may cause your antagonist to simply lose interest. For real fighters, it’s not much fun to fight someone who won’t fight back.

If he persists, move on to phase two.

2. “Dude said it was cool.”
This both reinforces the pacifist vibe and offloads responsibility onto someone else. Usually the guy provoking you will accuse you of breaking some rule stupid rule that his drunkenness dictates is worth fighting over. “Dude said it was cool” defuses your antagonist’s argument by placing you back in the land of the rule-followers. It was all a misunderstanding. You followed the rules—dude said it was cool. If your red-faced instigator is on the fence but asks which dude specifically, point to someone who looks like he could take the guy.

If he still won’t get out of your face, move on to phase three.

3. “Man…I’m just partyin’.”
If he’s still not letting it go at “Dude said it was cool,” you put your hands up by your chest, equal parts exasperated and clueless, and say “Man…” letting it hang for effect, “I’m just partyin’.” When you’re talking about guys who pick fights at parties, there’s usually some common ground when it comes to worldview. They’re likely to scorn party poopers, and probably respect the will to party. To party is a virtue. With “Man, I’m just partyin’,” you make a friend of your enemy, as if saying, “we’re both in this together” in a way he can appreciate and respect.