Creating a New Sub-Album
Click on the album dropdown on the side menu and choose Create New Sub-Album.
A pop-up will open where you can give your new sub-album a title and choose the parent album where you will place it.
Making an Existing Album a Sub-Album
If you have an existing album that you would like to make a sub-album of another existing album, simply drag and drop it onto the existing album in the side menu.
The sub-album will be nestled beneath the parent album in the menu and when you visit the parent album, the sub-album will appear as a thumbnail alongside the other photos in the album. Click the thumbnail to access that album.