A subdomain is a way to segregate areas of you site for specific uses. For example maps.google.com is a subdiomain of google.com.
You may use subdomains how ever you please. One practical use would be adding a subdomain for a tilecache.
Subdomains are easily added in the Plesk Panel. The files for subdomains reside seperately from your main site and can be found in the subdomains folder of your account.
