Step son has a crush on me

This is such a delicate situation and idk how to handle it. I have a daughter from a previous relationship. She's 20. Then my husband has a son from a relationship in his teens. He's 15.5. He's a pretty typical teenage boy. Video games, grumpy sometimes, eats the whole house, talks about girls. My daughter embarrassed him yesterday. We were at a Christmas party. And they got into a fight because she wants the front seat but he called shot guns. When we got there she was acting pissy and grumpy over the front seat. I told her to stop acting like. Toddler and she said "Careful. You're probably giving him an erection!" Very loudly. She said how she heard him talking to his friends about how hot I am and how hard I make him. It got quiet. Than my husband laughed about it making a lot of other people laugh and made my step son cry. Then when my husband realized his laughing didn't help he felt bad. My daughter had her dad pick her up because she knew she was in for it when we got home. My step son is embarrassed and upset and has locked himself on his room. My husband tried to talk to him but he doesn't want to talk. How do you handle such a sensitive situation?