Players take damage if an empty square on their side of the field is hit by an attack. If a square has a monster, the monster takes the hit. Otherwise, if its a blue square you take the hit to HP and if its red your opponent does. So if you place a piece targeting at your own side, it will damage you, for example.
All damage hits regardless of who dealt it, so both players can "friendly fire" at their own monsters and even their own side of the field, making it possible to throw the game by hitting yourself, if you choose to.
We'll have to make the rules more clear in the future ^^' and add a rules page - oops.