A subdomain is a part of a web address which is under the main domain name, for instance name.example.com. Actually, even in www.example.com the "www" part is a subdomain given that the fully qualified domain name is just "example.com". Each subdomain could have its own site and records and can even be hosted using a different provider if you want to use a certain feature which isn't provided 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 buy your products. You can also have a forum in which they can discuss the products and by employing subdomains as opposed to subfolders you will avoid any chance of all websites going down when you perform maintenance, or update one of the website scripts. Keeping your websites separated is also more secure in the event of a script security breach.