A subdomain is a part of a web address that's under the main domain, for example name.example.com. Actually, even in www.example.com the "www" part is a subdomain given that the fully qualified domain name is only "example.com". Each subdomain can have its own web site and records and can also be hosted using a different provider if you wish to use a specific feature which isn't offered by your current service provider. An example for using a subdomain is if you have a company website as well as an online store under a subdomain where customers can acquire your products. You can also have a forum in which they can discuss the products and by using subdomains as an alternative to subfolders you are going to avoid any chance of all sites going down if you perform maintenance, or update one of the website scripts. Keeping the sites separated is more secure in case of a script security breach.