Gravity is only induced by mass. The larger an object is, the more gravitational attraction it has. So you could stand 10 feet from a friend and there would be a gravitational attraction, but it would be so infintesimally small, you could not feel it. An experiment was carried out with two 250,000 tonne super tankers. Placed 6 feet apart, they did attract each other due to gravity. So to answer your question, things are attracted to a gravity centre; so when you drop a ball it heads for the centre of the Earth. The Earth is kept in orbit around the sun due to gravity; gravity does not occur because we are in orbit around the sun.
Yes, sddsddean is right. We are in orbit around the sun by way of our speed of travel (and therefore centrifugal force) being equal to the gravitational pull of the sun, therefore we remain the same distance away from the sun. But to clarify a little more, although we, (meaning planet Earth) are held by the gravitational pull of the sun, objects closer to the earth, ie us, and everything on the earth, are held by the gravitational pull of the earth.
It may seem picky, but, although the answer which emerges from the replies is correct, the terminology would be considered wrong by physicists. The momentum of our travel through space is along a straight line (no force along that vector) and the gravitational force of the sun bends the track we follow into an orbit (as the earth's does on satellites). The gravitational force in this case is a centripetal force, there being no such thing as a centrifugal force in strictly correct physics theory - unless I was misled.