There are several sites (buildings) that exist within a SharePoint portal, which serve different purposes. This is called a site hierarchy, which is illustrated in the following figure:

Over time, the site hierarchy can have hundreds of Sub Team Sites.

A Team Site can have a site within a site. This is known as a Sub Team Site and has the same functionality of a top-level site.

The preceding figure represents a site collection. These consist of a top-level site and one or more sites below it. Each top-level site and any sites below it in the site structure are based on a site template and can have other unique settings and unique content such as security, branding, and workflow setting.

The preceding description is slightly misleading in its explanation of sites as it states that houses are immediately next to the road site. This analogy is not the case in the SharePoint world as you can have what is known as Sub Team Sites. This is not so much as a house within a house, but rather a house off a house.

The analogy may be relevant if a site is called Project Management Office and its sub sites were projects.