Sub domain vs sub directory

which is better

[irhusker]

I'm curious from from a Google PR standpoint which is better, a sub domain or sub drirectory? Does it make any difference? I've heard that the PR of sub domain on a site is not associated with the PR that the root of the domain has. Is it treated as it's own domain?

sub.site.com

vs.

www.site.com/sub/

[Bewenched]

subdirectory

[Soze]

Depends on how popular the main site is.