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+# Subgroups
+
+> [Introduced][ce-2772] in GitLab 9.0.
+
+With subgroups (also called nested groups or hierarchical groups) you can have
+up to 20 levels of nested groups, which among other things can help you to:
+
+- **Separate internal / external organizations.** Since every group
+  can have its own visibility level, you are able to host groups for different
+  purposes under the same umbrella.
+- **Organize large projects.** For large projects, subgroups makes it
+  potentially easier to separate permissions on parts of the source code.
+- **Make it easier to manage people and control visibility.** Give people
+  different [permissions][] depending on their group [membership](#membership).
+
+## Overview
+
+A group can have many subgroups inside it, and at the same time a group can have
+only 1 parent group. It resembles a directory behavior, like the one below:
+
+```
+group0
+└── subgroup01a
+└── subgroup01b
+    └── subgroup02
+        └── subgroup03
+```
+
+In a real world example, imagine maintaining a GNU/Linux distribution with the
+first group being the name of the distro and subsequent groups split like:
+
+```
+Organization Group - GNU/Linux distro
+  └── Category Subgroup - Packages
+      └── project - Package01
+      └── project - Package02
+  └── Category Subgroup - Software
+      └── project - Core
+      └── project - CLI
+      └── project - Android app
+      └── project - iOS app
+  └── Category Subgroup - Infra tools
+      └── project - Ansible playbooks
+```
+
+Another example of GitLab as a company would be the following:
+
+```
+Organization Group - GitLab
+  └── Category Subroup - Marketing
+      └── project - Design
+      └── project - General
+  └── Category Subgroup - Software
+      └── project - GitLab CE
+      └── project - GitLab EE
+      └── project - Omnibus GitLab
+      └── project - GitLab Runner
+      └── project - GitLab Pages daemon
+  └── Category Subgroup - Infra tools
+      └── project - Chef cookbooks
+  └── Category Subgroup - Executive team
+```
+
+---
+
+The maximum nested groups a group can have, including the first one in the
+hierarchy, is 21.
+
+Things like transferring or importing a project inside nested groups, work like
+when performing these actions the traditional way with the `group/project`
+structure.
+
+## Creating a subgroup
+
+>**Notes:**
+- You need to be an Owner of a group in order to be able to create
+  a subgroup. For more information check the [permissions table][permissions].
+- For a list of words that are not allowed to be used as group names see the
+  [`namespace_validator.rb` file][reserved] under the `RESERVED` and
+  `WILDCARD_ROUTES` lists.
+
+To create a subgroup:
+
+1. In the group's dashboard go to the **Subgroups** page and click **Create subgroup**.
+
+    ![Subgroups page](img/create_subgroup_button.png)
+
+1. Create a new group like you would normally do. Notice that the parent group
+   namespace is fixed under **Group path**. The visibility level can differ from
+   the parent group.
+
+    ![Subgroups page](img/create_new_group.png)
+
+1. Click the **Create group** button and you will be taken to the new group's
+   dashboard page.
+
+---
+
+You can follow the same process to create any subsequent groups.
+
+## Membership
+
+When you add a member to a subgroup, they inherit the membership and permission
+level from the parent group. This model allows access to nested groups if you
+have membership in one of its parents.
+
+You can tell if a member has inherited the permissions from a parent group by
+looking at the group's **Members** page.
+
+![Group members page](img/group_members.png)
+
+From the image above, we can deduct the following things:
+
+- There are 5 members that have access to the group **four**
+- Administrator is the Owner and member of all subgroups
+- User0 is a Reporter and has inherited their permissions from group **one**
+  which is above the hierarchy of group **four**
+- User1 is a Developer and has inherited their permissions from group
+  **one/two** which is above the hierarchy of group **four**
+- User2 is a Developer and has inherited their permissions from group
+  **one/two/three** which is above the hierarchy of group **four**
+- User3 is a Master of group **four**, there is no indication of a parent
+  group therefore they belong to group **four**
+
+The group permissions for a member can be changed only by Owners and only on
+the **Members** page of the group the member was added.
+
+## Mentioning subgroups
+
+Mentioning groups (`@group`) in issues, commits and merge requests, would
+mention all members of that group. Now with subgroups, there is a more granular
+support if you want to split your group's structure. Mentioning works as before
+and you can choose the group of people to be summoned.
+
+![Mentioning subgroups](img/mention_subgroups.png)
+
+## Limitations
+
+Here's a list of what you can't do with subgroups:
+
+- [GitLab Pages](../../project/pages/index.md) are not currently working for
+  projects hosted under a subgroup. That means that only projects hosted under
+  the first parent group will work.
+- Group level labels don't work in subgroups / sub projects
+- It is not possible to share a project with a group that's an ancestor of
+  the group the project is in. That means you can only share as you walk down
+  the hierarchy. For example, `group/subgroup01/project` **cannot** be shared
+  with `group`, but can be shared with `group/subgroup02` or
+  `group/subgroup01/subgroup03`.
+
+[ce-2772]: https://gitlab.com/gitlab-org/gitlab-ce/issues/2772
+[permissions]: ../../permissions.md#group
+[reserved]:  https://gitlab.com/gitlab-org/gitlab-ce/blob/master/app/validators/namespace_validator.rb