The skin damage is most often started by the dog chewing, scratching, licking and gnawing at itself. In the first stages of the formation of hot spots, the skin becomes moist, red, itchy, and infected. Pus begins to ooze from the traumatized skin as infection sets in. Then, the dried pus and damaged skin surface will work to form a tightly-adhered crust, and you will likely notice hair loss over the infection site. The formation of moist dermatitis can be a very painful process, and frequently, dogs will show pain when the area is touched.