Minecraft Dungeons is a fun way to spend time with your friends. You can loot together, explore together, and die together. It is the dying that might cause some issues, as there is a limited number of team lives available to get through each dungeon or quest.
Team lives are a shared pool of lives that everyone has access to, and as long as there are some team lives available, you will be able to revive a fallen member of your party. If someone in the party takes lethal damage, run to their position, and interact with them.
You will need to be careful, as enemies won’t stop attack just to let you revive a fallen friend. Clear them all out first, then go for the revive. Each time you revive a party member, you lose one of your team lives, and when they are all gone you will no longer be able to revive a friend.
That is not the only complication. You only have a brief window to get to your fallen friend before extra enemies start to spawn on your location, and after 30 seconds a horrible creature will start to attack you from above. It is all quite stressful, and definitely one of the more tense and fun aspects of the game.
When you get to zero lives, your party will have one more chance to finish the level, but there will be no coming back if your party gets wiped out. It seems to be a way the developers can make you all play as a group, as it will be incredibly difficult to finish a level by yourself if you are being attacked by additional mobs.