Firstly understand that this won’t happen overnight. Be patient. Little and often is the key to slowly building up your dogs confidence.
To begin with start obedience training. It’s the first step in helping to socialise your dog as it will help them to feel comfortable in their body. The better they become at understanding and obeying commands the stronger their confidence will grow. You will praise them when they get something right and that too will develop their feeling of self worth. Physically doing jumps, tricks and runs, will give them a positive sense of their own body as well as strengthen them and keeping them fit. All of this is helpful in building up their self esteem. Teaching them to weave, play fetch and other tricks are fun for both of you as well as exercise and technique learning for your pet. Do not baby them when they are learning. If they need to be corrected because they got something wrong, do it. They will feel confident if they know their boundaries.
Dog socialisation means that your dog is taught (hopefully from a young age) how to feel comfortable with themselves around humans, other dogs and different environments regardless of their breeds and characters. Mixing them in as many different circles of people and pets is the best start. After the age of 4 months, if you have socialised your puppy correctly he should be very confident in new surroundings and company. If you haven’t done this from a young age or you’ve taken on an older dog, then the above obedience training will be a step in the right direction.
Take your dog to the park where you can both sit and watch other owners and dogs. Believe me it will help your dog to get used to being around others without having to interact at this stage. You need to do this as regularly as possible.
You could be unwittingly encouraging your dogs fear by your own behaviour.
Next time you’re walking your dog pay attention to how you react when another dog approaches. Do you immediately tighten the lead or guide your dog away from interacting? Do you talk to him and pat him as they draw closer? You may think this is a good way of reassuring him but your dog will pick up very quickly on your reactions and take being cautious as the normal thing to do when they see a new dog. Keeping quiet and calmly walking ahead without quickening your pace will not alert your dog to any problems. When your dog is scared the first thing you want to do is pet him to reassure him. Don’t, he will think you are encouraging his nervous behaviour as the correct way to feel.
Fear aggression is a state you do not want your dog getting to. This is very hard to correct. It is exactly as it sounds, aggressive behaviour produced as a result of fear. Basically a dog will attack or become aggressive first so that the other dog doesn’t. If you find yours has gone too far down this road then you really should invest in a dog behavioural expert. No amount of obedience training will change the underlying problems. I say “problems” because it is quite a complex issue. Fear, a lack of early socialisation, abuse and possible genetic conditions could all be contributing to this problem.
It may be that you never fully train your dog to change this problem as it is so deeply embedded, but with a behavioural expert and plenty of patience you can definitely help to alleviate it.