From Merriam-Webster
Definition of undermine
transitive verb
1 : to subvert or weaken insidiously or secretly, trying to undermine his political rivals
2 : to weaken or ruin by degrees
3 : to wash away supporting material from under
4 : to excavate the earth beneath : form a mine under
From Cambridge English Dictionary
undermine verb [ T ] UK
to make someone less confident, less powerful, or less likely to succeed, or to make something weaker, often gradually:

I had never come across this as a concept until I met someone who claimed I was undermining him. I certainly wasn’t having any secret meetings. I was perhaps simply being better than him at what we were then doing. It was bizarre, and only later did I realize he was accusing me of something he was in fact doing in regard of me.

This whole idea of undermining is a “touchy” subject. If you give it to someone straight, to their face, as you see it, are you enacting the definition as per the Cambridge Dictionary. I think not. But people can see it that way. You may make them less confident, but that could be a good thing, if they are over hyped.

If you claim that you did something which other people in fact did, are you undermining them? Yes.
If you spread gossip and rumour, are you undermining? Yes.
If you try to drive a wedge between people and their “friends” are you undermining? Yes, maybe.

But the key flavour in the concept of undermining is surely some kind of covert, even sneaky nature?

If you slag off those less powerful than you, are you undermining them? Yes
If you belittle others and big yourself up, are you undermining? Yes
If you listen to someone slagging others off and believe it, are you undermining? Yes
If you give faint praise in a back-hand manner, are you undermining? Yes.
If someone suggests that you are undermining them, are they merely talking about what it is they themselves are keen on and up to? Maybe

People who are paranoid often see undermining when it isn’t there. Perhaps this is because of what they themselves are doing.

Strange word this, undermining…