Have you ever had one of those conversations where you're being chased? The other person takes one step too close to you, and you step back, and they step forward, and before you know it, the race is on?
This is one of the difficulties that can arise from different concepts of personal space.
It's not a visible, but an invisible line between people, and when someone crosses it, you know. Not everyone's invisible borderline lies in the same place - and not every borderline stays in the same place all the time.
In Japan, typically people maintain a borderline that is further from them than ours here in the US. It's very practical. If you're both going to be bowing, and potentially bowing all the way to the horizontal, you have to take that into account when deciding where to stand, or you could sustain a head injury! So I guess it's okay to stand closer to someone when you're of about the same status and you won't have to bow low, but standing further away might be best with someone much older or of higher social status.
The one that always surprised and amazed me in Japan was the way the personal space borderline moves. If you're in a work or home situation, in a place where established social relationships exist around you and must be maintained, then the borderline falls at a distance. But if you're walking the Tokyo streets or traveling the subways with strangers, the borderline moves inward - to the skin. I was always amazed at how people in Tokyo would walk straight through me, constantly jostle and bump and never seem to notice they had done it.
To sensitive little American me it felt like a constant assault, and somehow I could never entirely turn it off, even after I got used to it. When I had just gotten back to California a woman in the supermarket apologized to me and at first I couldn't figure out why. Then I realized she was apologizing because the invisible path in front of her cart had accidentally entered the invisible path in front of mine.
I was tempted to give this woman a hug for being so considerate - but I wouldn't have wanted to invade her personal space. :-)