Currently, user profiles are in the format of website.com/username which is fine. However, some heavier users wish to use custom domain names. This is similar to Tumblr. Use
You're after wildcard DNS; http://en.wikipedia.org/wiki/Wildcard_DNS_record
Unless you have your own server (as in a dedicated or VPS server where you can configure apache) this won't usually be possible as shared hosts normally won't allow this.