WordPress has finalized a stable multi-user version of its world famous blogging software. if you wanted to have more than one blog in WordPress you had to have multiple installs. WordPressMU let’s you do the same thing with a single install and run them under sub-domains if you desire. You can also continue to add blogs and users to those blogs until you get tired.
I was encountering some difficulties installing WordPress MU  using different subdomains, and I finally figured it out after some time, so I thought I’d do a walkthough to help fellow MU-wannabes. Just follow few step to install. Installing wordpressmu is difficult then wordpress. So lets start…
Here I discuss about install wordpressMU into localhost. For this you need few change in windows configuretion and localhost server. First I discuss how to change your http://localhost to http://localhost.com .

step 1: Setting up locally on Windows!

WordPressmu will not run on the address http://localhost/ so will have to change the Windows HOST file a bit. I added this to the file:
127.0.0.1 localhost.com
This file can be found in this path in Windows.
c:\windows\system32\drivers\etc\hosts


OR there are another option to change this. Just download HostsXpert software and install. To using this software you change your localhost domain what you need.

Step 2. Download WordPress MU and extract the files!

You can download from here http://mu.wordpress.org/download/ . grab a copy of the source code. It should be a zip or tar.gz file. Doesn’t matter.

Step 3. Upload Those Files!

Extract all files into desired folder (ex: http://localhost.com/wordpressmu/) for host (ex: http://www.yourdomain.com/wordpressmu/)

Step 4: Enable mod-rewrite!


For Apache on my machine, mod-rewrite is not enabled by default. To enable mod-rewrite goto this file httpd.conf. you find this file here Open your httpd.conf file.(I install my server in c directory.
Search and change the following code:
#LoadModule rewrite_module modules/mod_rewrite. so

Remove the # at the beginning of the line. Should look like this

LoadModule rewrite_module modules/mod_rewrite.so


Save changes and Restart Apache Server.

Step 5: Create Database!

Create Database (without any tables). In PHPMyAdmin this task is fairly simple.
Step 6:  Enter the details!

enter-bl
Select “subdomains” in the Blog Addresses section, enter your mySQL credentials into the page, and the details of your main blog.
Hit submit and you will seeing that you are done! :D
Step 7: Log in !

Log in and make sure everything looks good.

wpmu-ins
now its install. enjoy the wordpress MU :D  you can use it many way.