What is the difference between WordPress multisite subdomain and subdirectory network installations, and when is each appropriate?

Question

WordPress Fundamental — Hard

What is the difference between WordPress multisite subdomain and subdirectory network installations, and when is each appropriate?

Accepted Answer

Subdomain networks require wildcard DNS configuration and are better for domain mapping, while subdirectory networks are easier to set up but cannot be used on existing WordPress sites with content at the root.