Why can't I understand group conversation?

I have a bit of an issue I've had all my life. I'm 22 now but when I was a kid I was extremely shy. I have since broken this tendency an am now fearless to engage in conversation but the problem is I can't. I can engage in conversation with one other person and be ok, but I can't engage in a "give and take" within a group of people. Honestly, I often just do not understand conversation, too many things are happening at once. Subsequently I come off as rude and stand offish. Do I have a learning disability of some sort? Anyone have any ideas? Alcohol has allowed me to be more open but can't solve the problem, actually it makes it worse so I don't feel its shyness.