Workgroups and domains explaine
It's important to understand the similarities and differences between domains and workgroups. Both are ways of grouping computers on a network. Unlike workgroups, domains are controlled from a central location and require central authentication before you can join them. Workgroups, in contrast, are much simpler. As long as you know the workgroup name, you can add any computer to a workgroup
A computer that is a member of a domain cannot also be a member of a workgroup. For example, if your notebook computer is on a domain at your workplace, it cannot also join your workgroup at home. This is the reason that if the Microsoft Broadband Networking Setup Wizard detects that your computer is already a member of a domain, it skips file and printer sharing setup for that computer
If you simply want to use your home network to access the Internet, you do not need to switch between your work domain and home workgroup. You can access the Internet over your home network while remaining a member of your work domain. In fact, you might even be able to access files and printers that are on other computers on your home network while you are joined to your work domain. However, you will not be able to easily share any files on your domain computer with the rest of the workgroup
So you can see that it is necessary to switch between a domain and a workgroup if you want to easily share files with your home computers. To do this, you must specifically disjoin your computer from the domain and join it to the workgroup. When you want to access your work domain again, you must rejoin the domain. You must restart your computer after you switch between a workgroup and a domain, and log on to the workgroup or domain with the proper user name and/or password
Switching between a workgroup and a domai
Switching between a domain and a workgroup can be risky, for the following reasons:
After you switch from a domain to a workgroup, you will not be able to log on to your computer by using your domain user name and password. If you don't know your local computer's password, you might be locked out of your computer.
To rejoin your domain, you will have to connect to your central domain controller. If the domain controller is unavailable for any reason, you will not be able to rejoin the domain.
If you change your computer name while you are a member of a workgroup, you might not be able to rejoin your domain.
After switching between a domain and a workgroup, you will have a different Desktop and My Documents folder than you did previously. However, you can find the Desktop and My Documents folders from your previous domain or workgroup under that user name in the Documents and Settings folder on your hard drive.
The above is an extract from Microsoft published text, for more read
http://www.microsoft.com/hardware/broadbandnetworking/10_concept_switch_workgroups_domains.mspx