When you initially sign up for your account you choose your PRIMARY domain name. You can add as many add on domain names to your account as you wish. Add on domains are fully qualified, independent domain names, eg:

www.yourdomain.com

A sub-domain, however, is an extension of a fully qualified domain name, eg:

http://sub-domain.yourprimarydomain.com

or

http://sub-domain.youraddondomain.com

You can create a sub domain by logging into your cPanel

i. Locate the Domain section

ii. Click the Subdomains link