A subdomain is a part of a web address that's under the main domain, such as name.example.com. Technically, even in www.example.com the "www" part is a subdomain given that the fully qualified domain name is just "example.com". Every single subdomain can have its own website and records and can even be hosted with a different company if you need to use some feature that is not offered 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 clients can purchase your products. You can even have a forum where they can comment on the products and by employing subdomains instead of subfolders you will avoid any probability of all websites going down when you perform maintenance, or update one of the website scripts. Keeping your sites separated is more secure in the event of a script security breach.