I'm attempting to setup WordPress multi site on my small ubuntu 10.04 laptop with apache2.

For normal WordPress installs in create an entry within the /etc/hosts file and make virtual hosts entry in /etc/apace2/sites-available directory after which soft link it to sites-enabled directory.

For instance:

 NameVirtualHost *:80
 <VirtualHost *:80>
      ServerAdmin webmaster@localhost
      ServerName mysite.com
      #We want to be able to access the web site using www.dev.example.com or dev.example.com
      ServerAlias mysite.com
      DocumentRoot /home/myhome/Sites/public_html/mysite.com
      #if using awstats
      ScriptAlias /awstats/ /usr/lib/cgi-bin/
      #we want specific log file for this server
      CustomLog /var/log/apache2/example.com-access.log combined
 </VirtualHost>

But this process doesn't work with sub domain names. What must i change so that all sub domain names indicate my installation too? I thanks ahead of time.

have a look in the virtual hosts entry, there should a characteristic much like one below :

ServerName www.domain.tld

ServerAlias domain.tld *.domain.tld

which should take proper care of the sub-domain names

Perhaps you have attempted checking your whole httpd.conf syntax? "apachectl confitest".

Perhaps you have attempted restarting apache? "sudo apachectl restart".

Perhaps you have attempted checking when the subdomains really indicate your server's ip? - ping domain.com - ping subdomain.domain.com

Look into the ip's. if they are different, then you've to improve your subdomains dns designs.

In the event that does not help, it might be useful should you could inform us just what happens when you are getting in to the subdomain. Do you receive a different output then expected? will it not really connect?