A subdomain is part of a web address that is under the main domain name, for example name.example.com. Actually, even in www.example.com the "www" element is a subdomain given that the fully qualified domain name is just "example.com". Every single subdomain can have its own web site and records and can also be hosted with a different company if you want to use a feature which is not offered by your current service provider. One example for using a subdomain is if you have a business site along with an online store under a subdomain where customers can purchase your products. You can even have a forum where they can discuss the products and by employing subdomains as opposed to subfolders you'll avoid any risk of all websites going down when you perform maintenance, or update one of the website scripts. Keeping your websites separated is also less risky in case of a script security breach.