A Sub Domain is usually a division of your main site accessed by an alternate domain name, aka sub-domain.
Traditionally most websites' domains are assumed to be preceded with "www." This is not absolutely necessary but is by far and wide a universally accepted norm (and we don't recommend deviating casually).
But let's say you want to expand your site, "abc.com," with some separate content... maybe a blog. One way to do this is create "blog.abc.com" which can appear as a completely different site or an integrated part of your existing site. Other examples might be "catalog.abc.com" or "store.abc.com."
To setup a sub domain:
1) Login to your cPanel portal (cpanel.yourdomain.com).
2) Find the "Domains" section and click the "Subdomains" icon.
3) In the form fill in the Subdomain name (just the part *before* abc.com).
Note: If you entered "store" as the subdomain name you should notice that the second form field, Document Root, automatically gets filled in with "/public_html/store." Caution- While this can be overridden we don't suggest changing this default to avoid confusion.
When someone goes to your site via www.abc.com they receive the content stored in your /public_html folder. By the same token, when someone now goes to store.abc.com they will receive the content stored in /public_html/store.
The astute reader may be asking, "Does that mean someone can also access this content by going to www.abc.com/store?" Well, YES, you're exactly right. ;)