Multisite

It can be difficult - especially when setting up a web server, which means not only dealing with Drupal, but also with Apache and Linux and name resolving and...

I'll try to explain my understanding of multisites. It does require a bit of background on web servers, and on Apache in particular. Oh yeah, and do expect typos, especially in domain and file names. Do your own research in the multisite documentation once the fundamental ideas have become a bit clearer...

Name-based virtual hosts (Apache)

The Apache web server has a feature called virtual hosts: It can be configured so that it delivers different web sites through a single Apache installation on a single computer (with a single IP-address) based on the domain name for which a request comes in. Technically, his works by assigning a particular file system directory to each domain name being served by the web server. For example, if the (physical) web server receives a request for www.mysite.com, it will send back whatever it finds in the directory configured for that domain. If the next request is for www.myothersite.com, it will return the content from the directory which is configured for that domain. This is the basis for all shared web hosting - one Apache installation can serve the web pages of hundreds of different web sites (or users. Or customers).

This configuration is setup in the system-wide configuration files for the Apache web server. On a typical Linux server, these files are usually located in /etc/apache or /etc/apache2; the detailed setup depends on the Linux distribution. It is not possible to introduce additional virtual hosts at the level of .htaccess files, simply because the web server has already gone through the virtual host resolution when it reaches that file. So if your hosting plan does not give you the option to add more domain-name based virtual web hosts, you won't be able to get them by editing the .htaccess file.

Multisites (Drupal)

In a way, the Drupal multi-site idea is very similar - instead of having several installations of the Drupal source code (one for each domain), you just use a single installation, and direct the requests to all domains to the one Drupal installation directory. Now Drupal also checks the domain name for which each request is intended, and then applies the domain-name specific configuration (= web site).

This domain-name specific configuration contains information on the database for that site, in particular the name of the database itself as well as the user name and password for that database. In general, you will still need a separate database for each web site (there are options to share a single database, or parts of the data base, but let's skip that for the sake of simplicity).

The Drupal configuration files are stored in the sites subdirectory of your Drupal installation. Drupal finds the 'right' one for any given request by following strict naming conventions: The configuration for mysite.com will be in sites/mysite.com, and the one for myothersite.com in sites/myothersite.com. If there's a request for a domain that doesn't have a specific configuration, the one in sites/default is used.

There are different option on how to name the different domains a single Drupal installation serves. You can have entirely different domain names (but see below). Or you can use subdomains, like sub1.example.com and sub2.example.com (in these cases, the configuration directories would be in sites/sub1.example.com and sites/sub2.example.com, respectively). Or you could use something like www.example.com/site1 and www.example.com/site2 - the corresponding configuration directories would be in sites/www.example.com.site1 and www.example.com.site2 if I have understood the documentation correctly. Note that the '/' in the site names has been replaced by a '.' in the configuration directory name.

Putting things together

If you want to use entirely independent domain names (like in your example), you must tell Apache to direct requests for both domains to the same Drupal installation. That is, you must configure Apache so that two different name based virtual hosts point to the same physical directory - the one where you have installed Drupal. Thus, you'll need access to the system-wide Apache configuration (if you fully control your Apache installation, you can also get away with having all http requests being sent to the same Drupal installation, but that won't work in any shared hosting environment, of course).

If you want to use a sub-domain (as in sub1.example.com and sub2.example.com), you can make use of the way the domain name resolution in the internet is usually set up: In most cases, sub domains are resolved as the main domain name. That is, if you type sub1.example.com in your browser address field, that will bring you to whatever IP-address the main domain (example.com). Actually, the use of www.example.com is just one specific example of this domain name resolving process... Anyway - if this works, sub1.example.com and sub2.example.com will both end up at example.com, that is at your Drupal installation - which can then do its separate things for each sub-domain (if different subdomains do not resolve to the same IP-address, you need to talk to your domain name provider).

And finally, with subdirectories (as in www.example.com/site1 and www.example.com/site2), you do not even have to rely on the correct domain name resolving.

Uhh. This got very long - my apologies. I said it can be difficult, didn't I? I hope it helps a bit anyway... And I hope there are not too many mistakes in all of the above - please correct whatever I've got wrong here!