A subdomain is the part of the web address that's before a domain and you have almost certainly seen a lot of subdomains while surfing around world wide web. For instance, many websites such as Wikipedia have versions a number of languages using subdomains - en.wikipedia.org, de.wikipedia.org etc. The best thing about using a subdomain is that it can have a separate website and its own records, so you can even host it on a separate server. The practical use is that one could have a supplementary site, like an e-learning portal for college students on top of the main school site. If you are using subdomains instead of subfolders, it's going to be much easier to perform maintenance or to upgrade a certain site, not mentioning that it's going to be more secure to have the websites separate from one another.