This sendmail(1M) message indicates that the destination host machine, specified by the address portion after the @ (at-sign), was not found during DNS (Domain Naming System) lookup.
Use the nslookup(1M) command to verify that the destination host exists in that or other domains, perhaps with a slightly different spelling. Failing that, contact the intended recipient and ask for a proper address.
Sometimes this return message indicates that the intended host is down, rather than unknown. If a DNS record contains an unknown alternate host, and the primary host is down, sendmail(1M) returns a "Host unknown" message from the alternate host.¤
For uucp(1C) mail addresses, the "Host unknown" message probably means that the destination hostname is not listed in the /etc/uucp/Systems file.
¤ This is a known sendmail(1M) version 8.6.7 bug.
For information on how sendmail(1M) works, see the Mail Administration Guide.