To create a sub-folder you first need to be inside a main folder of your choice. For example: Create a new folder, as shown in the How To Create A New Folder section (i.e. FILE menu >> NEW FOLDER menu-item), inside the DOCUMENTS (main) folder. Then rename that folder from untitled folder to Cooking. Cooking, which is a folder in its own right but also a sub-folder of the DOCUMENTS folder, for this example will then act as your main folder.
Remember. Any folder can be a main folder (like DOCUMENTS or Cooking), but unless it is the root folder (like the Machintosh hard drive folder) it will always be a sub-folder. In other words: DOCUMENTS is the main folder for all your Documents, but it is also a sub-folder of the USER NAME (i.e. Yoingco) sub-folder. The same applies to Cooking. It will act as your main folder for this example, but at the same time it is a sub-folder of the DOCUMENTS folder (sub-folder).
Apple tends to use the generic name Folder for everything, which in my opinion is wrong because sometimes it is best to clarify what type of folder is being created/used. This is why there is no menu menu-item anywhere called NEW SUB-FOLDER for creating a new sub-folder. You have to use the NEW FOLDER menu-item to create a new sub-folder.
With the main Cooking folder created (inside DOCUMENTS) double click on it (Fig 1.0) to open it (go inside it - Fig 1.1) and then look at its Path Bar (towards the bottom of its window - Fig 1.1). It should have Cooking at the end of it. Anytime you need to know which folder/sub-folder you are inside just look at the end of the Path Bar. In this example I have MACHINTOSH HD > USERS > YOINGCO > DOCUMENTS > COOKING which means Cooking is inside DOCUMENTS, DOCUMENTS is inside YOINGCO, YOINGCO is inside USERS and USERS is inside MACHINTOSH HD. Do not worry about understanding this though as Path Names and the Path Bar are explained in a later section.
Fig 1.0 Double Click on your main folder (i.e. Cooking) to open it (to get inside it)
Fig 1.1 Inside the Cooking folder (sub-folder of DOCUMENTS), after double clicking on it.
Now create three new folders, as shown in the How To Create A New Folder section (i.e. ACTION button >> NEW FOLDER menu-item), inside this main Cooking folder and then rename them Cook Books, Ingredients and Recipes respectively. Remember. These will be known as sub-folders inside the main Cooking folder. Here is what your three sub-folders should look like.
Fig 1.2 Three sub-folders have been created, inside the main Cooking folder.
To get out of a sub-folder you can either click on the BACK (Backwards/Previous) button located in the top-left corner of the folder's window (Fig 1.3 below) or double click on a previous folder's name (or icon) from the Path Bar located at the bottom of the folder's window (Fig 1.4).
Fig 1.3 Click on the BACK button to get out of the Cooking sub-folder and back into the DOCUMENTS folder.....
Fig 1.4 .....alternatively, Double Click on the path bar word DOCUMENTS to get out of the Cooking sub-folder.
If you want to create sub-folders inside other sub-folders, known as: sub-sub-folders, you would simply do the above again. So to create a sub-folder (sub-sub-folder) inside the Cook Books sub-folder, called Cakes for example, you would double-click on the Cook Books sub-folder to open it (get inside it) and then create a new folder called Cakes. Cakes would then be known as a sub-folder inside the Cook Books sub-folder, but also known as a sub-sub-folder of the main Cooking folder.
Fig 1.5 The CAKES sub-folder is a sub-folder of COOK BOOKS and a sub-sub-folder of the main COOKING folder
To clarify the above; The newly created folder called CAKES is a folder in its own right. However, it is also a sub-folder of the Cook Books sub-folder and a sub-sub-folder of the main Cooking folder. At this point you are only looking at the CAKES folder (sub-folder), from within the Cook Books sub-folder. You are not inside the CAKES folder (sub-folder). To get inside it (to open it) you have to double click on it. You know you are not inside the CAKES folder (sub-folder) because the Path Bar states that the last folder currently opened is the Cook Books folder (sub-folder).
At the end of the day you don't really need to concern yourself with sub-folders and sub-sub-folders. You could just be ignorant and say every folder is just folder. However, when it comes to navigation and knowing where a file lives for example (which folder a file is inside) that is when you need to know about sub-folders, sub-sub-folders and path names in general. In other words; If you want a better job in an office environment for example you will be one step ahead by knowing about the just mentioned. Folder and sub-folder hierarchy is important.