A subdomain is part of a web address which is under the main domain name, such as 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". Every single subdomain can have its own site and records and can even be hosted using a different provider if you wish to use some feature that is not offered by your current service provider. An illustration for using a subdomain is if you have a company site and an online store under a subdomain where customers can acquire your products. You can also have a forum where they can comment on the products and by employing subdomains instead of subfolders you'll avoid any risk of all sites going down if you perform maintenance, or update one of the website scripts. Keeping your sites separated is less risky in the case of a script security breach.