You must create the subcatalog you want to include (see Creating Catalogs) before you can add it to another catalog as a subcatalog.
To add a subcatalog to an existing catalog:
From the ATG Control Center main navigation menu, select Catalog Management > Catalogs.
Select the folder in which the catalog to which you want to add a subcatalog exists.
Click the catalog to which you want to add a subcatalog, so the catalog name moves to the left-hand panel and its properties appear in the right-hand panel.
Click the Add Catalog button to see a full list of the catalogs you can add.
Select the catalog you want to designate as a subcatalog of your main catalog.
Click OK.