What should I do here???????

You need to be honest with your friend, tell him what's going on with you and her and how she is bullying you. If you don't say bad things about her (like calling her names and such) but instead tell him what she's been doing to you, he probably won't think you're running her down. If he understands what's going on, he will probably sympathize with you and won't be too impressed with the other woman. If he doesn't know your side of the story, he won't understand why you're becoming withdrawn.