A subdomain is a part of a web address which is under the main domain name, for instance name.example.com. Technically, even in www.example.com the "www" element is a subdomain given that the fully qualified domain name is only "example.com". Each subdomain can have its own site and records and can also be hosted using a different provider if you want to use a certain feature that's not provided by your current provider. One example for using a subdomain is if you have a company site and an online store under a subdomain where clients can buy your products. You can also have a forum in which they can comment on the products and by using subdomains as an alternative to subfolders you are going to avoid any chance of all websites going down if you perform maintenance, or update one of the site scripts. Keeping your sites separated is more secure in case of a script security breach.