A subdomain is part of a web address that's under the main domain name, 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 just "example.com". Every subdomain could have its own website and records and can even be hosted with a different provider if you want to use a specific feature which is not offered by your current service provider. An illustration for using a subdomain is if you have a business website and 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 as an alternative to subfolders you'll avoid any probability of all sites going down if you perform maintenance, or update one of the site scripts. Keeping the websites separated is more secure in case there is a script security breach.