Also, you'll need a DNS wildcard A record for a catch-all domain, .domain.com as well as edit httpd.conf to have a ServerAlias .domain.com (assuming you are on apache).
I'm trying to do this now so I can run drupal on multiple subdomains.
However, I'm a newbie.
Is the DNS Wildcard an A Record? or a CNAME record?
I use godaddy, here is a screen shot of their Total DNS Wizard. Is the first - the Wildcard DNS (with asterisk)? Thanks.