A subdomain is part of a web address that's under the main domain, for instance name.example.com. From a technical perspective, even in www.example.com the "www" element is a subdomain since the fully qualified domain name is just "example.com". Each subdomain can have its own web site and records and can also be hosted using a different company if you want to use a specific feature which isn't provided by your current provider. One example for using a subdomain is if you have a business site as well as an online store under a subdomain where clients can purchase your products. You can also have a forum where they can talk about the products and by using subdomains instead of subfolders you'll avoid any chance of all websites going down if you perform maintenance, or update one of the site scripts. Keeping your sites separated is less risky in case there is a script security breach.